A lot of people hate charts because they do not predict anything and sometimes the chartist can come off more like a carnival sideshow barker than a serious market analyst. All those calls, warnings and targets… only to be wrong and have to revise, as if by magic.
But one thing charts can do is set very real parameters and rules. The new NFTRH key ETF chart service (added to the premium service at no extra charge) is purposely mechanical and rules based. It has been saying stock markets remain on bull signals and precious metals and commodities remain on bear signals. In a difficult market there is something to be said for rules.
They are now barfing quality like Franco Nevada, along with all the garbage that people have been puking up for months now. When the sector bottoms out of this destruction the rebound should be a turn and burn. FNV would set sights on the now declining EMA 50 as an initial bounce target.
FNV daily chart
Institutions are being forced to liquidate the good stuff and the coming sell out should signal the ending phase of this down leg. FNV is probably going to slam the thick support zone. Maybe even cut through it.
The sector is technically broken until some important upside resistance levels are taken out. HUI 460 sounded an alert 120 points ago and there have been several more levels breaking like twigs ever since.
The pukage in play now implies a good, hard trading opportunity is upcoming. But the institutions now getting forced into redemption need to calm down first. No urge to touch this just yet.
Royalty company Franco-Nevada (one I would consider a ‘quality’ item) did big volume on Friday and even put in a Hammer. Was that capitulation and opportunistic buying? Not sure. It has not even Fib’d 62% yet. But stocks like this are something to keep an eye on.
Franco-Nevada Daily Chart