...........HUI/XAU's Double Top/Lack Of Follow Through

The fact that HUI peaked only one session after Wednesday 10-4's dramatic decline at 295.86, then put in a perfect double top at 295.86 two days later on Monday 10-9, is a sign that 10-4's cycle low at 274.72 probably isn't an important one. The picture isn't much different for NEM and the XAU, which had little follow through after 10-5. Reliable lead indicator NEM may have hit a very important cycle low at 39.84 last Wednesday 10-4, right at it's Secular Bull Market/very long term upcycle trendline, on extremely high volume of 17.52 million shares. If NEM puts in a lower cycle low it should only be modestly below 39.84, whereas HUI/XAU will probably bottom well below 10-4's cycle lows, and, even that cycle low is probably just Wave A of their Wave 2 Cyclical Bear Market since 5-11-06, whereas, reliable lead indicator NEM is probably now in a Wave 3 Cyclical Bull Market since 10-4-06 (see first three charts at http://www.joefrocks.com/GoldStockCharts.html).

NEM broke out of it's very short term triangle (since early yesterday) to the downside early today. Watch the downside gaps from last Thursday at 40.83 for NEM and at 122.06 for the XAU.

The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see third chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. Therefore, the XAU is still 35-40 points above it's primary Secular Bull Market/very long term upcycle (since October 2000) trendline, which is about 30%+. The XAU and HUI have been in a Wave 2 Cyclical Bear Market since 5-11-06 and reliable lead indicator NEM has been in a Wave 2 Cyclical Bear Market since 1-31-06 (may have ended at 39.84 on Wednesday 10-4).

Reliable lead indicator NEM made a new Wave 2 Cyclical Bear Market (since 1-31-06) cycle low at 39.84 on Wednesday 10-4. NEM's Secular Bull Market/very long term upcycle trendline is currently at 39.84ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html).

The past sixteen weeks and two days the NEM Lead Indicator is a very bearish -16.62% versus the XAU. The NEM Lead Indicator was a modestly bullish +0.33% versus the XAU yesterday.

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 C down/another brutal decline began on Thursday 9-28 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