By: Jeff Cooper

Hit and Run Trading Morning Report - January 18, 2024

Fast Moves Come From False Moves: A Look At Trap Doors in GDXJ and AMD

GDXJ left a large range Key Reversal week in April 2022 that perpetuated an approximate 6 month 180 day/degree decline from 52 to 26 into early October 2022.

Notice that the weekly closing low for the decline was 27 region in mid-September.

This perfected a time/price square-out as 52 to 27  is 360 degrees in price in 180 degrees in time.

In my experience over a 40 year trading career, I have proven to my entire satisfaction as well as demonstrated over the 27 years I have been authoring the Hit and Run Report that the market is ordered and that geometric harmonics in time and price drive markets.

From that fall low in 2022, GDXJ rallied into April 2023, commemorating the 1 year cycle.

It marked another high from which another drop into late September/early October played out.

That 1 year cycle produced another rally; however, it was much more brief, getting rejected from the green Tops Line.

Notice the false breakout that defeat from the jaws of the bulls.

It was a Trap Door, a Bull Trap.

Fast moves come from false moves .

The false breakout produced a 4 week plumb-line drop from 40 to yesterday’s 33.50 low.

At the time Hit and Run flagged the potential for a Time/Price square-out as 40 squares out with December 21st.

You can’t make this stuff up.

The blue line is a CLOSE ONLY weekly trend line connecting the September 2022 low to the early October 2023 low.

Two things stand out:

1)      GDXJ is flirting with the blue Bottoms Line just below Wednesday’s close.

2)      GDXJ knows this close only trend line. The two prior tests of the trend line produced Trap Door buy signals. In other words after undercutting the line, GDXJ rallied

Whether we get another Undercut or a clean test of the blue Bottoms Line remains to be seen.

However, it is interesting that 33.50 is 90 degrees in price down from the December 39.80 peak.

As well, we have a 1 year cycle on deck: the week of January 23rd 2023 was an intermediate spike high. Additionally there was a low on the week of January 24, 2022.
It would be synergistic if we saw a mirror image fold-back spike low in this time frame.

In sum, GDXJ is working on a large triangle from April 2022.

Markets play out in three’s. 3 Waves up and 3 Waves down on all time frames.

If GDXJ holds this support region and turns up it will be in position to trigger a Rule of 4 Breakout.

This is a breakout above a 3 point trend line.

In this case, the 3 point trend line from April 2022, April 2023 and December 2023.

Is this downside done in the metals?

The answer to the question is that an impulsive (5 waves)  breakout in GDXJ thru 39-40 is yes.

The initial projection ties to 49-50.

Let’s take a look at another Trap Door…a buy setup on AMD in October.

But let’s track the path to that October low first.

AMD rallied sharply last May from 81 to the 130 region.

130 squares out with late May

AMD is a general that leads the market.

It tested the May high in June topping well ahead of the SPX in late July.

The May/June distribution pattern perpetuated a decline into late September where an accumulation pattern played out.

By that I mean a mirror image of the double top/test pattern in May/June played out with an Undercut of the September low in October.

That Accumulation/Undercut pattern was validated with a perfect Time/Price square-out on October 26th low of 93.


93 squares October 26th.

You can’t make this stuff up.

A 360 degree advance from the 93 low targets 136.

AMD blew through 136 in December, opening the door to 160.

This is because 160 is another 180 degrees up from 136.

In sum, from a low of 93, a 540 degree advance is 160.

540 degrees is an important measure as it is a true square-out, a cube.

A cube has 6 sides of 90 degree angles: 90 X 6 = 540.

Next week is January 26th which is a geometric 90 degrees/days from AMD’s October 26th low.

Hence we have a 540 degree price advance in 90 degrees of time which is a time to look to take profits and a possible change in trend.

That said, January 18 vibrates off 160 for a time/price square-out.

As I write this Thursday morning, AMD is gapping up to 163.

This is the 3rd day of a rip out of a mini Cup and Handle

If this morning doesn’t prove to be an Exhaustion Gap, then AMD has overhead room into late January…90 days from the October low.

171 vibrates/vectors October 26th, so the agenda might be a melt-up to the 170 strike region for an Opex Pinball play into Friday’s expiration.

This is how we put the pieces together…Time, Price, Pattern and Square-outs to make speculation a profitable profession.