NEM Outperformed the XAU by +0.14% Today BUT
Notice in the NEM Lead Indicator 1 day chart ( http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem ) that the gap between NEM and the XAU narrowed dramatically towards session end which indicates that some early weakness or weak strength tomorrow is likely.
From yesterday's late session Elliot Wave 3 short term cycle high at 48 NEM fell about a half session until today's cycle low at 47.16, which is probably a very short term cycle low rather than a short term cycle low, because short term downcycles usually last about 1 to 3 sessions, and, given how strong the prior short term upcycle was it's unlikely that a half session downcycle would correct it. Of course HUI and the XAU did have corresponding downcycles that lasted over a session, so given how bullish the NEM Lead Indicator is, one can't rule out that the Elliot Wave 5 short term upcycle has begun. That appears to be less than a 50% probability though. We'll see what tomorrow brings. Ciao
From yesterday's late session Elliot Wave 3 short term cycle high at 48 NEM fell about a half session until today's cycle low at 47.16, which is probably a very short term cycle low rather than a short term cycle low, because short term downcycles usually last about 1 to 3 sessions, and, given how strong the prior short term upcycle was it's unlikely that a half session downcycle would correct it. Of course HUI and the XAU did have corresponding downcycles that lasted over a session, so given how bullish the NEM Lead Indicator is, one can't rule out that the Elliot Wave 5 short term upcycle has begun. That appears to be less than a 50% probability though. We'll see what tomorrow brings. Ciao
posted by Joe Ferrazzano at
1:17 PM
5 Comments:
Joe,
Help me out here, if you would:
As referenced in this entry, short term cycle low would be the "weekly" cycle, and very short term cycles are shorter than that? I've never tried to measure anything that short.
Thanks again,
Jeff
By
Jeff, at 3:41 PM
Jeff,
Right, short term cycles last about a week on average, so weekly cycle would be a good name. Don't get too hung up on very short term cycles. The important point is that NEM's half session downcycle probably wasn't an entire short term downcycle. Ciao.
By
Joe Ferrazzano, at 4:04 PM
Jeff,
That half session downcycle was probably Wave A down of the short term downcycle, then it appears that Wave B up lasted about 3 hours today for NEM and Wave C down began near session's end, which means there should be a plunge early tomorrow, filling 11-23's gaps, and then it might be buying time!
By
Joe Ferrazzano, at 4:15 PM
Thanks, Joe. Wow, that is a short cycle. So hopefully after tomorrow or Thursday, we'll get a 5 up for a few days. That would fit my 505 to 515 target from the previous montly down cycle triangle plus a couple percent. Maybe it would exceed my target.
Then, a monthly downcycle. Yuck. I won't go against the long-intermediate trend to buy puts on the monthly - not enough chance for the cycle to bail me out if I mess it up.
And the COTs are getting into intermediate term danger zone.
After that, where do you think we are as far as the monthly cycles making up the intermediate?
By
Jeff, at 4:46 PM
Jeff,
Trading puts after the monthly upcycle EW 5 is risky as I'm sure you understand because of the potential rollover mode and higher highs than the EW 5 highs. If there is a rollover mode then "shorting" that with puts isn't too risky if you're a reasonably nimble trader. I've traded puts a few times with success but care must be taken.
This major intermediate term upcycle that began on 5-16-05 should last until about May 2006 based on the fact that the cycles have been getting longer. I heven't changed my thinking there but that's just an observation and when the major upcycle trendline breaks down it's time to turn bearish for a few months. Ciao
By
Joe Ferrazzano, at 7:35 AM
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