Recap for Aug. 5, 2021

Another day, and more losses. What can I say, other than it happens and as professional traders we must deal with it. We must always look for opportunities to improve. Today is another odd one, with several miners reporting great earnings results, only to see little interest in the group. When rallies start to move up, they haven’t been able to hold the gains. It’s uncomfortable, but we know what to do in any situation.

Some things to note on the daily charts, dare I say they are positive observations? 🙂 For one, we see gaps being closed on the daily charts today for GDX and GDXJ (also closed recently on SIL and SILJ). This alone is not a reason to buy, its more an action trigger for somebody that was already looking for an entry on these names. Another positive is that the daily stochastics I use (5,3,3) are nearing oversold, not quite there yet, but maybe we get there in the next trading day or two.

Lastly, I see the half-hour bar charts are oversold as we close the trading day. What does this mean? Well, a trader could buy this afternoon and then see what the morning brings, either add more, or enjoy a possible gap up. Either way, it looks like in the very, very short term, our holdings are due for a bounce. My preference is to see a lower open tomorrow, or at least a move lower after the open, maybe for the first 45 minutes or so, which would give an ideal opportunity to add to positions, for the trip back up to overbought. This is just a near term timing technique, something I use when it’s time to make the trade, either a buy or a sell, I always check the intraday (30 min bar charts) first.

I did place a few trades today, though nothing to get excited about just yet. Members should have received alerts of various trades, including Equinox Gold and Hecla Mining. As always, the data is posted in the Stops tab and the Daily Account Screenshots for members, which includes total position sizes, stop levels, and unrealized gains and losses which can have some big swings around here! No worries, as long as we keep our total risk controlled and push our winning trades for maximum gains. I’m going to post just a few charts, most look similar at this point anyway, so no need to go through too many. Let’s look at GDX, since I mentioned the gap closing and the daily stochastics approaching oversold (not there quite yet). In addition to closing the gap from the other day, notice GDX also sits right on it’s 10 day moving average. Don’t get me wrong, there is plenty not to like as well, such as the “death cross” kicking in soon as the moving averages cross each other heading lower, and the general downtrend. We have to let the market tell us where it’s headed, all we can do is have contingency plans and then let it play out as it chooses.

Here is a quick look at Hecla Mining, which had a positive earnings report and tried to mount a serious rally, but all it could hold onto was meager gains. This can mean that in the short term that the pullback isn’t quite finished. I added to to my HL today and might buy more in the near future, but I prefer to see the group get some traction before I do any big buys. This market has required lots of patience recently, so I will wait to see if the weak close today in our holdings might give us a better buy setup in the morning, specifically the first 90 minutes of trading. Let’s see what happens.