New Annotated Three Month NEM Chart With The Elliot Wave Count
Reliable lead indicator NEM has a bearish triple top formation, since NEM hit a monthly cycle high at 46.89 on 11-1 and Thursday's cycle high at 46.86 was a bearish Wave B triple top (see chart 1 at http://www.joefrocks.com/GoldStockCharts.html), with the third cycle high at 46.80 on 11-3.
As discussed previously, since Thursday's Wave B cycle high at 46.86 was so close to the monthly cycle high, Wave C of NEM's monthly downcycle is probably going to basically be like a complete monthly downcycle, so, NEM will probably have a relatively well defined Wave B up in an Elliot Wave ABC down up down pattern in it's Wave C. It's almost as if NEM's monthly downcycle began just before Thursday's close. HUI/XAU probably hit monthly cycle highs on 11-9. The big 4%+ spikes are typical of important cycle highs.
So, the fact that reliable lead indicator NEM peaked more than a week before HUI/XAU (on 11-1 versus 11-9), and, is probably going to have a big long Wave C short term downcycle (instead of the usual 2-4 session Wave C) that will be similar to but probably more severe than a typical entire two weekish monthly downcycle, is a major negative for HUI/XAU, because, it means that their Wave A short term downcycle will probably be a severe long two weekish one versus the usual 2-4 session Wave A.
Given that HUI/XAU rallied toward their Wave 2 Cyclical Bear Market (began 5-11-06) downtrend lines in the latest monthly upcycle, and, appear to be about to enter Wave C of Wave C (Wave C is probably doing an Elliot Wave ABC down up down pattern), HUI/XAU may be about to experience a vicious 3-6 weekish 30-40% decline that should mark the end of their Wave 2 Cyclical Bear Market (began 5-11-06). They should decline to or at least approach their Secular Bull Market/very long term upcycle trendlines at 200ish for HUI (the trendline could turn up to 220ish since HUI is more parabolic/volatile than the XAU) and at 90ish for the XAU, see charts 2 and 4 at http://www.joefrocks.com/GoldStockCharts.html.
The very bearish one year NEM Lead Indicator suggests that a vicious decline is likely in the near future, and, may have begun on 11-9-06, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1y&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem.
The other scenario is the 2 weekish monthly downcycle scenario where HUI/XAU drop 8-15%. If the vicious decline scenario occurs short term there should soon be some big down days of 3-5%+. It should make itself obvious.
The NEM Lead Indicator was a slightly bullish +0.09% versus the XAU on 11-10, was a bearish -0.47% on 11-9, was -0.15% on 11-8, and, was a bearish -0.61% on 11-7.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 2 and 4 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 3 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
As discussed previously, since Thursday's Wave B cycle high at 46.86 was so close to the monthly cycle high, Wave C of NEM's monthly downcycle is probably going to basically be like a complete monthly downcycle, so, NEM will probably have a relatively well defined Wave B up in an Elliot Wave ABC down up down pattern in it's Wave C. It's almost as if NEM's monthly downcycle began just before Thursday's close. HUI/XAU probably hit monthly cycle highs on 11-9. The big 4%+ spikes are typical of important cycle highs.
So, the fact that reliable lead indicator NEM peaked more than a week before HUI/XAU (on 11-1 versus 11-9), and, is probably going to have a big long Wave C short term downcycle (instead of the usual 2-4 session Wave C) that will be similar to but probably more severe than a typical entire two weekish monthly downcycle, is a major negative for HUI/XAU, because, it means that their Wave A short term downcycle will probably be a severe long two weekish one versus the usual 2-4 session Wave A.
Given that HUI/XAU rallied toward their Wave 2 Cyclical Bear Market (began 5-11-06) downtrend lines in the latest monthly upcycle, and, appear to be about to enter Wave C of Wave C (Wave C is probably doing an Elliot Wave ABC down up down pattern), HUI/XAU may be about to experience a vicious 3-6 weekish 30-40% decline that should mark the end of their Wave 2 Cyclical Bear Market (began 5-11-06). They should decline to or at least approach their Secular Bull Market/very long term upcycle trendlines at 200ish for HUI (the trendline could turn up to 220ish since HUI is more parabolic/volatile than the XAU) and at 90ish for the XAU, see charts 2 and 4 at http://www.joefrocks.com/GoldStockCharts.html.
The very bearish one year NEM Lead Indicator suggests that a vicious decline is likely in the near future, and, may have begun on 11-9-06, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1y&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem.
The other scenario is the 2 weekish monthly downcycle scenario where HUI/XAU drop 8-15%. If the vicious decline scenario occurs short term there should soon be some big down days of 3-5%+. It should make itself obvious.
The NEM Lead Indicator was a slightly bullish +0.09% versus the XAU on 11-10, was a bearish -0.47% on 11-9, was -0.15% on 11-8, and, was a bearish -0.61% on 11-7.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 2 and 4 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 3 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
posted by Joe Ferrazzano at
12:01 PM
