11-11 Thoughts and Indications

HUI, NEM, and the XAU gapped up at the open then quickly fell and filled those gaps. The NEM Lead Indicator at -0.34% yesterday and at about -0.50% today as I write this portends weakness as does XAU Implied Volatility which fell to 32.72 yesterday from 33.075 the day before despite a -1.04% decline in the XAU yesterday, which is a significant rise in complacency that portends weakness. The XAU Put/Call Ratio (Nov expiration) rose to 0.77560 today from 0.77262 yesterday which portends strength. So, the indicators in concert with cycles (which are the primary market timing consideration) suggest early weakness today followed by strength.

Reliable lead indicator NEM has been doing an Elliot Wave A, B, C correction/very short term downcycle since hitting a very short term cycle high just after the open yesterday. Once NEM "resumes" it's short term upcycle, probably today, gold/silver stocks should be off to the races again.

HUI and the XAU have broken their downtrend lines since the 9-30-05 monthly cycle highs (see 3 month XAU chart http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=off&z=l&q=b&p=&a=m26-12-9,p12,fs,w14&c= ) and are in wave 3 of the monthly upcycle that began on 10-20-05, so there should be another higher cycle high than the one that occurs in this short term upcycle.

So, things are going as expected, meaning that last weekend's update assessment ( http://www.joefrocks.com/TradetheCycles.html scroll down past the major averages work) remains unchanged. You should read it and maybe read it twice. The charts are very important because cycle channels/trendlines are the primary market timing consideration. Ciao