Transcription:

Hey, Dan Murphy here and I'm coming to you, not exactly live, but an intra-day update here and I wanted to get some stuff out there for you. I'm just not taking about gold and precious metals but also a very low sector, very unknown sector that really fell off a cliff and is staging a rebound.

I want to show you the exact signs to look for, the exact pattern to look for when you have market that is loathed and it might be turning in to a love environment.

But first let's go over gold. Because I was talking about that glaring diversion between gold and gold stocks, and one of two things had to happen. Gold either needed to climb or needed to have gold stocks rally and gold stocks rally like crazy. That’s great to see all is right with the precious metals universe again. This is what I like to see, a resumption of bull markets.

Big declines in gold and silver over the past several months. And I know that we've been trading in and out of that quite a bit and it's just great to see that this could be something that sticks a little bit longer than some of the rally's that we've had before.

But anyway, the low sector; I know you're just dying to hear about it. The low sector that I'm looking at right now is uranium. So the symbol that you could trade for a basket of mining stocks, those companies that are involved in the production of uranium and so forth is URA. And as you know, the disaster in Japan really sparked off a lot of negativity about uranium. A lot of plants plan to be shut down, notably in Germany and so forth.

We're always looking at price. The price is what really matters. Because when you have a collective of people, they tend to get it right with their actions, which basically you either make money or lose money in the stock market. So let me show you what exactly I'm looking at.

So the first thing you want to see is completely low sector. So this thing has fallen off a cliff. It keeps rallying and then that rally doesn't stick; doesn't stick again. You have a rally here, it doesn't stick and just keeps doing that over and over. Then you finally have a rally that was much bigger than all the previous rally's by a pretty decent size margin I might add. Then what we need to do is start looking buying a 50% retracement. I always call is the Attack of the 50's. That’s exactly what I was looking at. That move was bought pretty darn close to the 50% retracement low.

But then the next move, this one over here, the second move off of the bottom is often times one of the most profitable. So this is something where you have to keep close stops of course, but it could turn into a trend. So this is something that I've seen in every market. This pattern works intra-day, so again it's all about looking for just a low sector or index. The time frame doesn't really seem to matter. I've used this even on tick charts and volume charts on the e-mini that's been a real fun one to trade for a long time. Again, you simply buy the 50% retracement over here and you look for a trend.

Usually you get at least this move over here. We've gotten pretty close to that, but this is a market that is turning back to bullish after just a huge decline. An amazing decline really. But now that seems to have been factored in, maybe we can start trading around this. Put that on your radar screen. Hope that helps you. I'll catch you next time. This is Dan signing out.