Tuesday, September 16, 2014

Four risk-on charts to ponder as risk-on rallies

Here's 4 risk-on charts to ponder as risk-on rallies:

HYG is printing a bullish multi-outside candle today, after having spent several days at -2SD and RSI dropping to 30.

So you'd think at the very least it's gotta be good for a few-day bounce to the short EMA or the Bollinger mean.

$VIX is printing an outside day after having gone +3SD - with the previously-noted period-dependency caveat, of course.

It is still in its upward trend, don't forget that! I guess you should really wait til it breaks below its short EMA before you bring out the beer.

Nevertheless, the bigger the red candle, the more I suspect the $VIX rise is done.

I guess we'll get to see tomorrow how much of the downside protection buying of the past month was just being done in anticipation of this week's Fed meeting. Cos damn, $VIX sure has been trending upward for a month now and frankly that just looks silly.

Well, silver's chart is still frickin' atrocious. Today's pop doesn't change the downtrend at all. Though maybe, with silver having trended down for 2 straight months already, "down" might have become far too much of a sure thing and it might be about time for Mistress Market to discipline the shorts with some vigourous anal lovemaking.

I dunno, it might still take a couple days before we really know what's going on with silver.

But if we don't know what's going on with silver, why should GDXJ be looking positive?

I like this chart. There's been a massive blob of selling all through September: look at the selling volume in that chart. Far too much volume. Looks funny.

What did all that selling accomplish, price-wise?

I guess it's still adviseable to sit and wait for GDXJ to crawl back above the EMA, and silver to end its downtrend. After all, the trade that you should want to make is a multi-month 30% advance in your favourite junior miner. You should not want to make a 3% stupid daytrade. But the multi-month 30% advance will give you a few days' warning, so there should be no rush, no?

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