...................Short Term Finetuning Thoughts
First of all I want to say that my thoughts and prayers are with the Hawaiians/tourists affected by the 6.5 magnitude quake that occurred at 7:07 a.m. local time today, 10 miles north-northwest of Kailua Kona, a town on the west coast of the Big Island. I've been to the big island of Hawaii and specifically I've been to Kailua Kona, as well as to Oahu, where Honolulu is, and, Hawaii is one of my favorite places.
Concerning this week's action for HUI/NEM/XAU, more upside is likely early on Monday followed probably by a significant/possibly sharp pullback for a day or two. As previously discussed the COT (Commitments Of Traders, see http://www.cftc.gov/dea/options/deacmxsof.htm) data is short term bearish but intermediate term bullish (because of the substantial positive net long weekly change), because the gold Commercial Traders increased their long position by an unusually large (> 10%) 14,526 long futures and options contracts, which portends some significant weakness next week, as does the significant increase in their short position, which increased by 4,024 short futures and options contracts.
William's %R for HUI/NEM/XAU is in or near overbought territory (above -20). When/if it reaches an overbought extreme near 0 a significant pullback will probably occur shortly thereafter. Basically I'm reiterating what I said previously about waiting for a significant pullback (buy weakness if you're looking to buy), probably during the early to middle part of this week. After seeing tomorrow's action that assessment may change.
The XAU and HUI have been in a Wave 2 Cyclical Bear Market since 5-11-06 and reliable lead indicator NEM was (until 10-4-06) in a Wave 2 Cyclical Bear Market since 1-31-06 (probably ended at 39.84 on Wednesday 10-4). NEM's Secular Bull Market/very long term upcycle trendline is currently at 40ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html). 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
Concerning this week's action for HUI/NEM/XAU, more upside is likely early on Monday followed probably by a significant/possibly sharp pullback for a day or two. As previously discussed the COT (Commitments Of Traders, see http://www.cftc.gov/dea/options/deacmxsof.htm) data is short term bearish but intermediate term bullish (because of the substantial positive net long weekly change), because the gold Commercial Traders increased their long position by an unusually large (> 10%) 14,526 long futures and options contracts, which portends some significant weakness next week, as does the significant increase in their short position, which increased by 4,024 short futures and options contracts.
William's %R for HUI/NEM/XAU is in or near overbought territory (above -20). When/if it reaches an overbought extreme near 0 a significant pullback will probably occur shortly thereafter. Basically I'm reiterating what I said previously about waiting for a significant pullback (buy weakness if you're looking to buy), probably during the early to middle part of this week. After seeing tomorrow's action that assessment may change.
The XAU and HUI have been in a Wave 2 Cyclical Bear Market since 5-11-06 and reliable lead indicator NEM was (until 10-4-06) in a Wave 2 Cyclical Bear Market since 1-31-06 (probably ended at 39.84 on Wednesday 10-4). NEM's Secular Bull Market/very long term upcycle trendline is currently at 40ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html). 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
posted by Joe Ferrazzano at
1:55 PM
