Loading ...DUST Diamond, Pedro, Nightingale
I’m going to admit my lack of comprehension here and try to learn something. Regarding the DUST Diamond post below by Nightingale:
Pedro said regarding ‘it can be a continuation’: ‘Yes, and that’s my rather firm conviction in this case, in line with previous remarks on this Risk On market.’
Nightingale said ‘I see a DUST DIAMOND BO a Bull FLAG. Seems obvious to me what follows which I believe is UP.’
Does that mean you guys think DUST is going to continue down (GDX up since DUST is an inverse etf), or does it mean you think DUST is going up (GDX down)?
I don’t see a bull flag in that DUST chart. That diamond looks more like a bear flag to me. Maybe I am visually challenged or not looking in the right place.
I do see a kind of bull flag in the GDX chart below, over say the last 3 weeks, running along the 200 DMA.
Please clarify what you mean so ‘us handicapped chartists’ (me) can learn. Thank you and Happy Holiday season to all.
Sir Randerson, Trust your instincts. You are better at chart interpretation than you give yourself credit for. It is quite clear from the charts that gold and the gold miners (GDX) are going higher in the near future and much higher over the course of months. Disregard the noise from others and instead of looking for all kinds of convoluted patterns and whether they are continuing or reversing just focus on the fact that gold and the miners have been making higher highs and higher lows for the last few months.
I like your response Chartmaster. I agree GDX is a buy right here as well. The thing about diamonds is they are best viewed in the rear view mirror. I can’t trade them. Most of the time I can’t even recognize them until its too late to take an action. Unless its a really large pattern such as we see on a 60 minute chart or larger they are not worth the time to bother with since its just consolidation anyway. The DUST diamond is not obvious to me in this case. There are easier ways to read charts.
As for starter you should stretch out you chart and zoom in. Alternative smaller time frame both the whole chart and TIME was as well like 15-min.
And even though DUST/GDX would be a ‘continuation’ … and such is possible but little. CHECK POST ‘DIAMOND DUST’ below as I added a THUMB-nail.
In this Thumbnail you can observe a RED DUST BULL FLAG. If you stretch-out you GDX-daily (possibly 1 or 2 hour) you ‘should observe a GDX BEAR FLAG.
IF … the whole BULL FLAG (on my DUST chart) is a pattern (in itself) while the DIAMOND is a HALFWAY-MARK the for sure DUST could ‘continue’ lower making 2x EQUAL decline of measured 23.1%. But such decline would be limited and is something pedrodeleon and I agree on although I believe we differ in TIME as I believe the TURN is around the corner (give it potentiaal 10 more days) and pedro believes potentially time will take longer.
The limited ‘continuation’ for either GDX or DUST can be measured as follow: 16 -/- (1-.231) = 12.3 as PO while DUST now @ 14.49 gives rest for DUST to decline 2.19 equals 13.6% (2.19/16) divided by two (as DUST goes 2x GDX) = 6.8%. While GDX today @ 28.87 give a PO of 30.83 for GDX (= 28.87 x (1 + 0.068)). And such PO for GDX is still within the possibilities for GDX as TOPPING-OUT a Right-shoulder on GDX on a Much Larger TIME frame (both TIME and candle-wise). As mentioned GDX right shoulder tops out at 30/31-ish.
Last … it is not only about the GDX where DUST is being derived from. Also many other insights like ‘currencies’ on which I have reported before. The combination of elements choosing to weigh in gives a believe (system) which direction to look for; either UP or DOWN as next direction. Always Trade with a Plan!
So as RAMBUS-DIAMOND tutorial outlines a DIAMOND could both be a continuation as well a reverse ‘mark’. This sort of standstill can therefore go either way. It could become a ‘continuation’ but limited as outlined in my calculation/measured-exercise but DUST good easily JUMP UP out of the DIAMOND next week. I see a PINK DUST-DIAMOND crawling out of a RED Bull Flag. Such I see as double bullish. Both BT-ing the FLAG on the BO while creating a revearsel-mark. As always … shall see!
Anyway, thanks for the mind excercise.
DYODD. IMO
I really don’t know why people allow DUST to F with their mind by charting it out then trying to apply it to GDX by claiming the inverse. Just chart GDX for goodness. DUST is such a flawed instrument with all of its time decay that it simply invalidates it as a vehicle used to analyze anything.
100 percent agree just chart gdx dust is unchartable due to decay
Make that three of us! Hate Dust….hate hate HATE!
(Yes it burned me. Long story…many years ago….I will never forget though. LOL)
Sure we know DUST-decay I do not trade such … I just choose multiple-ETFs as they tend to be ahead of the curve going forward and show little signs. Furthermore I like DUST to F with peoples mind who thinks GDX is the only thing while mocking others about charting DUST.
I am not mocking. Actually I am a very big fan of your charting style. Maybe your biggest fan. Keep up the great work Nightingale.
Any discussion of plays has to involve timeframe.
N and I agree that PMs are setting up bearishly but disagree on timing.
He may have just changed his tuned, however, and so I’m not as certain on his views.
Back to the diamond .. I have it as bullish continuation “but not for long”.
When that completes, likely inside of a month, N and I will be looking for entries in GDXD or DUST.
I’ll get more clarity after the new year.
PS .. I have absolutely NO PROBLEM charting inverses if that’s the direction I’m looking to play. My tools are set up to work just as well with 3x longs as -3x shorts or the underlyings. (Its not conventional T/A to be sure.)
Usually, my system tells me to sell longs before I get buy shorts signals, as there is a conservative lean built into the way I get my signals.
“I do see a kind of bull flag in the GDX chart below, over say the last 3 weeks, running along the 200 DMA.”
Yes. Market has worked off an OB condition at intermediate degree and is now OS without having lost the uptrend at higher degrees. Solid dip buy setup using most recent daily lows as stops.
Thanks for all the input. Whew, the more complex methods I still just don’t get. The more I look at the GDX chart here the more June-November looks like a cup and December looks like a forming handle. If that handle or bull flag gets down to around 26 or 27 it might even be a pretty textbook variety, albeit a bit slanted, no?
Good observation. A thought about ETF’s and indicies regarding technical analysis. While the general principles should be relevant, when you are dealing with an ETF or index it is not as defined as when dealing with a specific security or commodity. The more components making up the respective ETF or index the more likely to have discrepancies and or distortions from the usual expected behavior as far as filling specific T/A parameters. You may have noticed I rely on and get extremely accurate buy and sell targets from gaps on specific stocks and commofities etc. I rarely spell out such gaps in ETF’s because while they can sometimes work, the precision is not there because of the numerous numbers of components involved.
That is an interesting thing to consider. It also makes me wonder if more individuals buy the ETFs than the components (i.e, the institutions managing the ETFs buy most of the shares of the single, component stocks), and if so TA might even be more valid on the ETFs. I’m not clear on this and have a hard time thinking it through.