Wave 3 Short Term Upcycle Began Last Thursday
And today's large gap up by the XAU looks like a short term breakaway gap. The XAU wants to fill it's upside gap at 159.41 from 5-15 as previously discussed. SPX (S & P 500) strength today is a major factor behind HUI/XAU/NEM strength due to index fund trading, see http://finance.yahoo.com/q/ta?t=5d&s=%5EHUI&l=on&z=m&q=l&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC.
The intraday action since last Friday has been poor. From very early on Friday to very early yesterday the XAU made very little progress, and, most of today's XAU gains so far came from the gap up at the open. Nearly all of this Wave 3 short term upcycle since late last Thursday has been gapping up/spiking action lasting less than 1 hour.
Given/assuming that NEM began an 18 monthish Wave 2 Cyclical Bear Market on 1-31-06 and HUI/XAU did so on 5-11-06 one should be more cautious now about trading long. After this minor intermediate term upcycle since 6-13 peaks I expect lower lows to occur than those that occurred on 6-13.
Sometimes with short term trading ugly/risky rallies occur and good entry points are rare/difficult to come by. The NEM Lead Indicator at -4.31% versus the XAU last week and at -1.13% so far this week is a strong indication that risk is high right now, though the XAU wants to fill it's upside gap at 159.41 from 5-15.
There was a very sharp decline last Thursday which I probably should have realized (easy in hindsight) was a short term cycle low, but, the NEM Lead Indicator was a very bearish -1.78% vs the XAU last Thursday and the short term downcycle only lasted 5 hours, which was a brief short term downcycle. Friday's large gap up was a sign that a short term cycle low had occurred late on Thursday.
The Monthly Upcycle began early on Monday 7-24 and a 2% buy signal occurred on Tuesday 7-25. An entry point for monthly cycle traders "should" occur in the next few sessions Wave 3 corrects (Wave 3 tends to be a long short term cycle), but risk is high now. ....... http://www.JoeFRocks.com/
The intraday action since last Friday has been poor. From very early on Friday to very early yesterday the XAU made very little progress, and, most of today's XAU gains so far came from the gap up at the open. Nearly all of this Wave 3 short term upcycle since late last Thursday has been gapping up/spiking action lasting less than 1 hour.
Given/assuming that NEM began an 18 monthish Wave 2 Cyclical Bear Market on 1-31-06 and HUI/XAU did so on 5-11-06 one should be more cautious now about trading long. After this minor intermediate term upcycle since 6-13 peaks I expect lower lows to occur than those that occurred on 6-13.
Sometimes with short term trading ugly/risky rallies occur and good entry points are rare/difficult to come by. The NEM Lead Indicator at -4.31% versus the XAU last week and at -1.13% so far this week is a strong indication that risk is high right now, though the XAU wants to fill it's upside gap at 159.41 from 5-15.
There was a very sharp decline last Thursday which I probably should have realized (easy in hindsight) was a short term cycle low, but, the NEM Lead Indicator was a very bearish -1.78% vs the XAU last Thursday and the short term downcycle only lasted 5 hours, which was a brief short term downcycle. Friday's large gap up was a sign that a short term cycle low had occurred late on Thursday.
The Monthly Upcycle began early on Monday 7-24 and a 2% buy signal occurred on Tuesday 7-25. An entry point for monthly cycle traders "should" occur in the next few sessions Wave 3 corrects (Wave 3 tends to be a long short term cycle), but risk is high now. ....... http://www.JoeFRocks.com/
posted by Joe Ferrazzano at
8:13 AM
