The Brutal Wave A Of The Major Downcycle Since 9-6 Continues

HUI, NEM, and the XAU all made new cycle lows today for Wave A of the major downcycle since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM. The indicators all pointed to weakness today as did the COT data. I discussed XAU Implied Volatility and the COT data over the weekend. The XAU Put/Call Ratio (October expiration) plunged to 0.82715 today from 0.86677 on Friday, which pointed to a potentially very weak session, which is obviously what's happening. The XAU is down -3.02% right now. The NEM Lead Indicator on Friday was a bearish -0.57% versus the XAU. This is just Wave A of the major downcycle since 9-6. A lot of ex gold/silver bugs are being created.

The past fourteen weeks the NEM Lead Indicator is a very bearish -12.70% versus the XAU. A vicious multi week decline, similar to the one that occurred from 5-11-06 until 6-13-06 for HUI/NEM/XAU, began on 9-6 for HUI/XAU and on 9-5 for reliable lead indicator NEM. Wave A of this major downcycle since 9-6 is still in effect (may last a few more sessions). Wave B up of the major downcycle since 9-6 might last over a week, Wave B in the prior major downcycle from 5-11-06 until 6-13-06 did, then it's time for the final Wave C down and another brutal decline for HUI/XAU, in which Wave A of their Cyclical Bear Market since 5-11-06 bottoms, probably in the 100-110 range for the XAU. For recent action see http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=b&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. ....... http://www.JoeFRocks.com/

HUI NEM XAU