AMEX:JNUG   DIREXION DAILY JUNIOR GOLD MINERS INDEX BULL 3X SHARES
3 Hours Chart

Well this is the first week in the last several weeks that I did not hit my mark. We gapped up and that looked like a strong opening but then went down the rest of the day. Can’t be right 100% of the time. But I am still confident that we will go higher in the coming couple weeks.

1st – lets address the yellow arrows that I put in my chart for this last week. That is put there to show my mistakes on Friday of last week calling price direction for this week. So what did I do wrong? Last Friday, Price dropped into my target area and filled the gap just like I thought. My thought was that it would bounce from there and on Monday, that’s what it did until an intraday turnaround lower. What I forgot to do was check Volume to help me see that we hit a low and short term trend change. Had I not forgotten that, I would have seen that we had diminishing volume suggesting that we had further downward price movement to go. Earlier I said that usually, but not always, I have found that these trend changes tend to happen on Tuesday or Wednesday. Well on Wednesday it dipped deep and then swung up huge with a volume spike and that should have been my signal to sell Dust and buy Jnug             . I left several thousand dollars on the table with that mistake. So shame on me for forgetting. Ill try not to forget about that next time. Someone remind me for the end of October.

Moving on to next week

I should start off by saying, I am simply not sure. Jnug             and gold             both showed weakness this week. The economic data on Thursday and Friday was slightly better than expected with the exception to PCE. However, Monday is Day 1 of China’s currency being allowed in to the SDR             currency basket. I am not sure if that will have any positive affect for gold             so we will have to wait and see. I doubt it will have any affect. We did see a nice rally in the broader market today, the day after Germany announced their Deutsche bank collapse. This might be the start of people pulling their capitol out of Europe and trying to find a safe haven in the US markets. This could be the start of a strong rally in the markets. Jnug             seems to usually go up when our markets go up, just not today. That being said, I’m just not sure about price direction for next week. So while we could have a typical Jnug             spike for a day or two, which I would welcome, I feel we are going to churn mostly sideways, relatively speaking. I hate sideways movement.

My strategy for next week

I am holding my Jnug             . I will be watching to see if we have a decent spike in Jnug             early next week. If we spike to reach the top of the wedge , then I will sell Jnug             no later than the 4th to allow my funds to settle for the Oct             7th unemployment report. IF I sell, I will be looking for a buying opportunity on a dip. That would be the best case scenario I could see for next week. Worst case scenario, that I see, is a sideways grind along the bottom edge of this wedge . I do not see us breaking down below the wedge . My data does not point to that happening yet. I see us finding a top in mid October before starting a two week decline to end this cycle. The data on October 7th will be the key to how high we go the following week. As of today, my price target for October 14th is the $23 range. If October 7th data is worse than expected then I see us running up high and then settling there on that Friday. That would also coincide with spot gold             possibly finally breaking out of its bull flag . I just don’t think its going to be a huge break out. Not even to $1400. I’m looking at a minimum of 1345 but most likely 1360 1370’s. Otherwise, it might be just a hard climb for Jnug             . After that, we should stair step down the rest of the year.
Comment: So what just happened this morning is called an undercut low. There is nothing to predict such a move. All cycle analysis goes right out the window. There was nothing significant about any economic data today to have a move. All that happened to trigger this move was Hawkish words from a Fed Member. That's it! So people will call this type of move, "manipulation". I would tend to agree. About two days ago, a veteran cycle analyst, Gary Savage, said he would not be surprised to see an undercut low in gold. What he was referring to was big money creating this move so that people freak out and sell them their shares at a very low price. That way big money gets to buy at a phony bottom. Its real in that it is happening as we speak but phony because it should have never happened. So, since I have seen this before, and since the veteran analysts have seen this before, I will not sell and try to leverage down. I will weather the storm. It sucks short term. But the rally that should follow should be quite big.
Still Gold seems to want to revisit $1,300 area again (at a minimum), I still think the best case scenario would be re-tagging $15.20 line; while, in the worst (and likely) case, a support line able to put a stop to the current downtrend needs to be found below that price.

There is, obviously, also a gap in between $10.60 - 12.90. If Gold slides below $1,300, anything is possible.

Personally, I've been on side lines since I was stopped out last Tue. I'm not willing to commit my money until I see Gold bottomed in the recent downward move.
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SalN PRO VirtualFax
Yes. I saw that gap today actually. Still we are very oversold. I think we are still due for one more pop and then probably down to fill that gap. The economic data keeps holding things up. Somethings gotta give either way soon. One analyst that I follow was talking about an undercut low to Get big money the best position for the leg up. We will see
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Mind sharing your analyst? : )
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SalN PRO VirtualFax
Yes. I follow two. I do not ever believe everything they say. I follow them because they are both slightly in opposition as to what comes next. I like to compare their points of view. 1st - Gary savage. 2nd. Larry edleson.
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Yes, I know exactly what you mean by not believing everything. Neither do I. Whatever I read, I only do so for the sake of scanning for new ideas that might enhance my own analysis. I never rely on other people's conclusions.

Anyway, thanks for sharing.
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And I wouldn't call it very oversold. RSI is 41, while both MACD and Stoch still have room underneath on daily. And, obviously, with each s/t pop that room gets only roomier to accommodate even more downside if needed.
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Now we have a chance to close the gap as soon as today or tomorrow...
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VirtualFax VirtualFax
200 MA as a first potential reversing point??

If doesn't hold (and, honestly, I don't expect it to hold), then there seem to be nothing else preventing JNUG from closing the gap.
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VirtualFax VirtualFax
Will be placing my buy order at $9.63 with a tight stop. Yes, very conservative, I agree, but Gold seems to be targeting its own 200 MA.
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SalN PRO VirtualFax
hey. draw a trend line from the last two big dips. approx. 7/25 and 8/31 and then extend it to just past today. This may be a channel that we are in. This also might bottom today or tomorrow and bounce. I am not sure if that gap gets filled this time. Just a heads up.
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