Tuesday, March 31, 2015

[JNUG] update

The model at the backlink was broken today.  New model is below.  There are actually two ways I can read this chart so there is a bit of uncertainty over the longer term.  I could read it as 5 down OR that the big triangle of Friday the 27th was a B wave which bisected the A and C waves.  Since we have a pretty clear 4th wave HT which finished around noon and then sold off into the afternoon with 5 waves down which looks like the end of red C.  Then we had what appeared to be 5 small waves back up right into the close which took back most of the loss on the day.  The chart hit resistance at the horizontal which was the tip of W3 so I think that is 1 up.  Thus I expect a small pullback as shown and then at least the red and more likely the green or blue paths.

So I do not yet see compelling evidence that the big JNUG reversal has occurred.

Since metals prices drive the miners, and since silver is the most volatile of the metals, here is the SLV count.  It could have just finished an expanding wedge by stopping mid channel on the E wave as shown.   This model expects an AM move up for metals tomorrow as well but the question will be whether it has the force to break out of the top rail (thus making it likely the early stages of a 3rd wave up) OR whether it remains a 3 wave move which then halts at resistance thus forming a DDT and then heading south again per the red path.

I usually have a pretty strong feeling on which path will be taken but I see energy on either side of the equation or, perhaps said just as correctly, no conviction on either side.  It still looks like volatility to me, the herd waiting in a holding pattern for a sign of some sort.  bottom line, I'm holding JNUG overnight but will get stopped out easily if SLV cannot break out with some kind of conviction tomorrow AM.  By this I mean I will keep bumping my stops up as JNUG rises and then probably sell at market when it kisses that top rail and then only buy back if it can break out that rail.  What would be nice would be a gap up above that rail at the open.  That would be a clear short term hold signal for JNUG.

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