The NEM Lead Indicator = -0.08% Vs The XAU Today

And became negative near session's end, with NEM leading to the downside, as evidenced by the narrowing of the performance gap between NEM and the XAU: http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem. Wave B's Wave 2 down for HUI/XAU began yesterday and should go parabolic tomorrow, with a sharp decline and downside gap filling action likely. See 5 day XAU chart: http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau

The XAU has downside gaps at 140.44 from 5-31 and at 135.54 from 5-25 that may get filled in the next few sessions and has a downside gap at 130.03 from 3-24 that shouldn't get filled until Wave C. NEM has downside gaps at 51.40 from 5-31 and at 49.53 from 5-25 that may get filled in the next few sessions. ....... http://www.JoeFRocks.com/

Early Strength Should Be Followed By Downside Gap Filling Action

Strength in SPX (S & P 500) led to gold/silver stock strength early today due to index fund buying. Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau, with the XAU's cycle low on Monday 5-22 at 133.17 forming a near perfect double bottom with Wednesday 5-24's cycle low at 133.19, and, HUI also has a double bottom. Wave B's Wave 2 down began yesterday for HUI/XAU. Notice how closely the XAU tracked SPX (S & P 500) recently: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC.

The NEM Lead Indicator was a slightly bearish -0.21% vs the XAU yesterday. The NEM Lead Indicator was a slightly bullish +0.10% vs the XAU on 5-26, was a bullish +0.29% vs the XAU on 5-25, was a bullish +0.79% vs the XAU on 5-24, a bearish -1.04% vs the XAU on on 5-23, and, was a combined bullish +1.20% the prior two sessions. The XAU has downside gaps at 140.44 from 5-31 and at 135.54 from 5-25 that may get filled in the next few sessions and has a downside gap at 130.03 from 3-24 that shouldn't get filled until Wave C. NEM has downside gaps at 51.40 from 5-31 and at 49.53 from 5-25 that may get filled in the next few sessions. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator Was A Slightly Bearish -0.21% Vs The XAU Today

Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau, with the XAU's cycle low on Monday 5-22 at 133.17 forming a near perfect double bottom with Wednesday 5-24's cycle low at 133.19, and, HUI also has a double bottom. Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a slightly bullish +0.10% vs the XAU on 5-26, was a bullish +0.29% vs the XAU on 5-25, was a bullish +0.79% vs the XAU on 5-24, a bearish -1.04% vs the XAU on on 5-23, and, was a combined bullish +1.20% the prior two sessions. The XAU has a downside gap at 135.54 from 5-25 that may get filled in the next few sessions and has a downside gap at 130.03 from 3-24 that shouldn't get filled until Wave C. NEM has a downside gap at 49.53 from 5-25 that may get filled in the next few sessions. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator Has Turned Bullish

The past three weeks with NEM outperforming the XAU last week by +0.54% and the prior two weeks by +3.06% and +1.28%. Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau , with the XAU's cycle low on Monday at 133.17 forming a near perfect double bottom with Wednesday's cycle low at 133.19, and, HUI also has a double bottom.

There's no weekly update this week and no new charts, unless I decide to do them tomorrow.

Notice how closely the XAU tracked SPX (S & P 500) recently thanks to index fund trading: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC.

The COT data is basically bullish, with the gold Commercial Traders trading substantially net long in the five days ending 5-23-06 and the gold Speculators trading substantially net short in the five days ending 5-23-06 http://www.cftc.gov/dea/options/deacmxsof.htm. However, the significant long liquidation by the gold Commercial Traders and the unusually large long liquidation by the gold Speculators points to some weakness (non contrarian case short term), with most of the weakness probably occurring last week because the data is three days old when released. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator Was A Slightly Bullish +0.10% Vs The XAU Today

But the gap narrowed late in the session, with NEM peaking early in the session while the XAU peaked late, so early weakness is likely on Tuesday. Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau, with the XAU's cycle low on Monday 5-22 at 133.17 forming a near perfect double bottom with Wednesday's cycle low at 133.19, and, HUI also has a double bottom.

Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a slightly bullish +0.10% vs the XAU today, was a bullish +0.29% vs the XAU yesterday, was a bullish +0.79% vs the XAU on Wednesday, a bearish -1.04% vs the XAU on Tuesday, and, was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator Was a Slightly Bullish +0.10% Vs The XAU Today

But the gap narrowed late in the session, with NEM peaking early in the session while the XAU peaked late, so early weakness is likely on Tuesday. Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau, with the XAU's cycle low on Monday 5-22 at 133.17 forming a near perfect double bottom with Wednesday's cycle low at 133.19, and, HUI also has a double bottom.

Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a slightly bullish +0.10% vs the XAU today, was a bullish +0.29% vs the XAU yesterday, was a bullish +0.79% vs the XAU on Wednesday, a bearish -1.04% vs the XAU on Tuesday, and, was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = +0.10% Vs The XAU Today

But the gap narrowed late in the session, with NEM peaking early in the session while the XAU peaked late, so early weakness is likely on Tuesday. Wave B up began on Monday 5-22 for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau, with the XAU's cycle low on Monday 5-22 at 133.17 forming a near perfect double bottom with Wednesday's cycle low at 133.19, and, HUI also has a double bottom.

Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a slightly bullish +0.10% vs the XAU today, was a bullish +0.29% vs the XAU yesterday, was a bullish +0.79% vs the XAU on Wednesday, a bearish -1.04% vs the XAU on Tuesday, and, was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = +0.29% Vs The XAU Today

Wave B up began on Monday for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau , with the XAU's cycle low on Monday at 133.17 forming a near perfect double bottom with Wednesday's cycle low at 133.19, and, HUI also has a double bottom. Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a bullish +0.29% vs the XAU today, was a bullish +0.79% vs the XAU yesterday, a bearish -1.04% vs the XAU on Tuesday, and, was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

...........The Fed Spiked The Punch Today

As they always do on Thursday, with a massive +$18.25 Billion in Repos, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm. The NEM Lead Indicator is a bearish -0.40% vs the XAU right now, was a bullish +0.79% vs the XAU yesterday, a bearish -1.04% vs the XAU on Tuesday, and, was a combined bullish +1.20% the prior two sessions.

Note that NEM hit a long term cycle high and probably a Cyclical Bull Market cycle high on 1-31-06 versus 5-11-06 for HUI/XAU. The wide disparity between when NEM peaked and when HUI/XAU peaked is a strong indication that an 18 monthish Cyclical Bear Market has begun for HUI/NEM/XAU, because NEM is a reliable lead indicator. Since many gold/silver stocks' cycles lag or are out of sync with HUI/NEM/XAU there are still a lot of good investing and trading opportunities in the sector. ........ http://www.JoeFRocks.com/

Looks Like A Wave B Double Bottom For HUI/XAU

Wave B up probably began on Monday for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau , with the XAU's cycle low on Monday at 133.17 forming a near perfect double bottom with today's cycle low at 133.19, and, HUI also has a double bottom. Notice how closely the XAU tracked SPX (S & P 500) again today: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC. The NEM Lead Indicator was a bullish +0.79% vs the XAU today, a bearish -1.04% vs the XAU yesterday, and, was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

Notice That Late Session Weakness Coincided With S & P 500 Weakness

See: http://finance.yahoo.com/q/ta?t=5d&s=%5EXAU&l=off&z=m&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=&c=%5EGSPC . SPX (S & P 500) drives index fund trading. Wave B up began on Monday for HUI/XAU, see http://finance.yahoo.com/q/ta?t=5d&l=off&z=m&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=&s=%5Exau . The NEM Lead Indicator was a bearish -1.04% vs the XAU today and was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

Notice That The Rebound Coincided With S & P 500 Strength

See: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . SPX is firm so far today. Wave B up began yesterday for HUI/XAU. The NEM Lead Indicator is a bearish -0.50% vs the XAU right now and was a combined bullish +1.20% the prior two sessions. ....... http://www.JoeFRocks.com/

.........Wave A Down May Have Bottomed Today

See: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . The NEM Lead Indicator was a bullish +0.40% today and was a bullish +0.80% vs the XAU on Friday. The XAU has a downside gap at 130.03 which is the last remaining unfilled downside gap of those created in recent months. ....... http://www.JoeFRocks.com/

....................Weekly Update's Ready

At http://www.joefrocks.com/TradetheCycles.html scroll down a few pages past the major averages work to see the gold/silver stock work. See 15 month charts, the major upcycle since 5-16-05 has probably peaked for HUI/NEM/XAU, and an 18-24 month Cyclical Bear Market has probably begun, that coincides with Elliot Wave 2 down of the Secular Bull Market/very long term upcycle since late 2000.

See http://www.joefrocks.com/GoldStockCharts.html for all the charts. My home page is http://www.JoeFRocks.com/ I hope you'll take the time to e mail your friends re this Blog and my site/work/system. This will help to keep my work free, because the more visitors I get the more advertising $ I make. I have a long way to go but have made significant progress in recent months. Thank you

................Disclaimer

Joe Ferrazzano is not a registered investment advisor. Investing in stocks involves risk. Joe Ferrazzano is not a registered broker or dealer. Each investor has to ascertain what percentage if any of one's investments should be allocated to growth stocks or gold/silver stocks. Please see a financial planner, registered investment advisor or at least do your homework and decide what is right for your situation. Growth stocks and gold/silver stocks tend to be extremely volatile which creates opportunities but also can be very painful and risky. Each investor must take complete responsibility for his or her investing actions. Joe Ferrazzano should be considered as one source of information out of many from which to derive a decision on investing.

.........Wave A Down May Have Bottomed Today

See: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . The NEM Lead Indicator was a bearish -0.41% yesterday but was a bullish +0.80% vs the XAU today.

The XAU has downside gaps at 134.17 from 3-29, at 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has a downside gap at 49.24 from 3-24.

....... http://www.JoeFRocks.com/

Notice That The Rebound Coincided With S & P 500 Strength

See: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= .

The intraday rebound coincided with S & P 500 (SPX) strength.

The XAU has downside gaps at 134.17 from 3-29, at 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has a downside gap at 49.24 from 3-24.

....... http://www.JoeFRocks.com/

...........Is A Cyclical Bear Market Upon Us?

Wave A Down continues today: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . The NEM Lead Indicator was a bearish -0.41% yesterday but is a bullish +1.05% vs the XAU right now. The XAU has downside gaps at 134.17 from 3-29, at 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 49.46 from 3-27, and at 49.24 from 3-24. It looks like NEM is going to fill it's remaining downside gaps today or Monday and the XAU may do so as well.

This wasn't supposed to happen in Wave A, the gap filling action should have finished in Wave C, so, the major intermediate term upcycle since 5-16-05, the long term upcycle since 5-10-04, and the first Cyclical Bull Market (HUI/NEM/XAU) of the very long term upcycle/secular Bull Market that began in late 2000 may have ended. Have a nice weekend!

There seems to be far too much fear revealed by the XAU Put/Call Ratio at 1.30191 and XAU Implied Volatility at 47.255, both at extremely high levels, for a major cycle high to occur, and, there hasn't been the kind of long liquidation or short selling by the gold Commercial Traders that one would expect to see near a major cycle high. As long as the major upcycle remains intact, really as long as a 5% follow through sell signal doesn't occur, Trade the Cycles will remain on a major buy signal.

Much of the gold/silver stock weakness recently has been due to index fund selling caused by a weak S & P 500 (SPX), so one must keep that in mind also. Index funds have become a huge factor. Much of this weakness is simply due to index funds mechanically selling their gold/silver stock components.

....... http://www.JoeFRocks.com/

Weak S & P 500 (SPX) Led To More Downside Today

Wave A Down continued thanks to a weak SPX today: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . Index fund selling hurt gold/silver stocks today. Option expiration on Friday is probably a factor as well. Also, the Fed didn't spike the punch as much as they normally do on Thursday (http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE) and Fed Credit for the week ending 5-17 rose a meager $1 Million, see http://www.federalreserve.gov/releases/h41/Current/ . The NEM Lead Indicator was a bearish -0.41% today, which indicates that additional downside is likely tomorrow. ....... http://www.JoeFRocks.com/

.......The NEM Lead Indicator = +0.63% Today

So, the monthly downcycle's Wave A short term downcycle may have bottomed today: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . Index fund selling hurt gold/silver stocks today, since the S & P 500 (SPX) was down -21.77 points. The Fed always seems to spike the punch on Thursday, which should help tomorrow. ....... http://www.JoeFRocks.com/

Weak S & P 500 (SPX) Led To More Downside

Wave A Down continues thanks to a weak SPX today: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= . Index fund selling is hurting gold/silver stocks today. ....... http://www.JoeFRocks.com/

.............Wave A Down Bottomed Yesterday

The monthly downcycle's Wave A down bottomed at 144.01 for the XAU yesterday: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= , so, the next few sessions should see a substantial rebound corresponding to the Wave B short term upcycle. Note that the downside gaps at 52.87 for NEM and at 145.47 for the XAU got filled yesterday, and, as usual, an important cycle low occurred shortly after gap filling action was completed. ....... http://www.JoeFRocks.com/

............Looks Like Wave A Down Bottomed Today

The monthly downcycle's Wave A down appears to have bottomed at 144.01 for the XAU today: http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= , so, the next 3-5 sessions should see a substantial rebound corresponding to the Wave B short term upcycle. Note that the downside gaps at 52.87 for NEM and at 145.47 for the XAU got filled today, and, as usual, an important cycle low probably occurred shortly after gap filling action was completed. ....... http://www.JoeFRocks.com/

Wave A Short Term Downcycle Still In Progress

There are downside gaps at 52.87 for NEM and at 145.47 for the XAU that may get filled today. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=m&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

Monthly Downcycle Wave A Short Term Downcycle

Appears to have bottomed late yesterday: http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=m&q=c&p=&a=m26-12-9,p12,fs,w14&c=
HUI fell over 15 % in less than three sessions. So, a Wave B short term upcycle is probably in effect. Based on the extreme fear level (XAU Put/Call Ratio at 1.69138 today and XAU Implied Volatility at 41.545 yesterday) and the COT data in recent weeks, which doesn't remotely show a level of short selling or long liquidation by the gold Commercial Traders one would expect to see near a major cycle high, the major upcycle since 5-16-05 appears safe. One more monthly upcycle is likely, then the major upcycle may peak. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = -0.34% Vs The XAU Today

The NEM Lead Indicator = +0.10% vs the XAU on 5-5, was -1.00% vs the XAU on 5-4, -1.53% vs the XAU on 5-3, -1.46% vs the XAU on 5-2, -1.20% vs the XAU on 5-1, and -1.10% vs the XAU on Friday 4-28. The NEM Lead Indicator has been very bearish recently which points to a very sharp decline this week.The monthly cycle probably peaked Friday 5-5 for the XAU, Wednesday 5-3 for HUI, and on Monday 5-1 for NEM. HUI/NEM/XAU are in a Wave A short term downcycle. Fed Credit rose +$2.991 Billion in the WE 5-3 which is probably factored in to HUI/NEM/XAU since their monthly cycles have probably peaked: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

...........Strong NEM Sell Interest Again Today

at Lycos Thomson I Watch: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=9&y=1

It's been this way for (probably) over a month, with the sell interest intensifying the past two weeks. Combine this with substantial insider selling at NEM recently(http://finance.yahoo.com/q/it?s=nem), a very bearish NEM Lead Indicator last week at -5.09% vs the XAU and has been very bearish for months (http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem), and, with the US Dollar due to rebound sharply, it adds up to a likely 15-20% decline in HUI/NEM/XAU over the next few weeks. ....... http://www.JoeFRocks.com/

Barrick (ABX) And Fed Credit Held Things Together Last Week

If it wasn't for Barrick's strong performance since releasing a good earnings report and the Fed's punch spiking the past 5 sessions, http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE, the gold/silver stock market would have been much weaker.

The XAU put in a monthly cycle high on Friday. HUI put in a monthly cycle high on Wednesday, and, NEM hit a monthly cycle high on Monday 5-1, leading as usual. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

The Fed spiked the punch as they always seem to do on Thursday, with a massive $19.25 Billion in Repos. The prior few days were respectable also and today was a large $9.25 Billion 1 day Repo. It appears to be plunge protection at work, but all it did was delay the process and resulted in modest additional upside for HUI/XAU: http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.46193 today and XAU Implied Volatility closed at 35.415 on Friday, which is a very high level of fear.

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle. Today's upside gaps at 56.43 for NEM and 161.89 for the XAU are probably breakaway gaps that won't get filled until the next monthly upcycle.

The NEM Lead Indicator is a modestly bullish +0.25% vs the XAU right now, was a slightly bullish +0.10% vs the XAU on 5-5, was a very bearish -1.00% vs the XAU on 5-4, was a very bearish -1.53% vs the XAU on 5-3, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28.

The latest COT data (as of 5-2-06) is short term bearish/mixed since the gold Commercial Traders traded net short, but the gold Speculators also traded net short, which portends some strength as does the Commercial Traders' long trade, but much of the strength probably occurred last week because the data is three days old when released and gold spiked substantially higher in recent weeks. The gold Commercial Traders added 5401 long futures and options contracts and added 7399 short futures and options contracts which portends weakness this week (non contrarian indicator), but the long trade points to some strength. The gold Speculators (hedge funds and other speculators/traders) added 1712 long futures and options contracts and added 2330 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released, and the long trade points to some weakness.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/

....................Weekly Update's Ready

At http://www.joefrocks.com/TradetheCycles.html scroll down a few pages past the major averages work to see the gold/silver stock work. See 1 year charts that show the likely Elliot Wave points for the major upcycle since 5-16-05, the monthly upcycle since 3-10-06 that appears to be (or has peaked) peaking for HUI/NEM/XAU. See http://www.joefrocks.com/GoldStockCharts.html for all the charts. My home page is http://www.JoeFRocks.com/ I hope you'll take the time to e mail your friends re this Blog and my site/work/system. This will help to keep my work free, because the more visitors I get the more advertising $ I make. I have a long way to go but have made significant progress in recent months. Thank you

................Disclaimer

Joe Ferrazzano is not a registered investment advisor. Investing in stocks involves risk. Joe Ferrazzano is not a registered broker or dealer. Each investor has to ascertain what percentage if any of one's investments should be allocated to growth stocks or gold/silver stocks. Please see a financial planner, registered investment advisor or at least do your homework and decide what is right for your situation. Growth stocks and gold/silver stocks tend to be extremely volatile which creates opportunities but also can be very painful and risky. Each investor must take complete responsibility for his or her investing actions. Joe Ferrazzano should be considered as one source of information out of many from which to derive a decision on investing.

Mr. Wayne Murdy, Chairman of Newmont Mining, Sold 78,030 Shares 0n 5-2-06

Mr. Wayne Murdy, Chairman of Newmont Mining, sold 78,030 shares 0n 5-2-06, one day after NEM hit a monthly cycle high, resulting in proceeds of approximately $4.5 Million. His timing in the past has been good
and this is obviously a large meaningful insider sale.
This is another major factor that supports the substantial correction scenario.
Other NEM insiders also made substantial sales recently. See http://finance.yahoo.com/q/it?s=nem for NEM insider activity. ....... http://www.JoeFRocks.com/

..............................New Charts Uploaded

The major upcycle's (since 5-16-05) Wave 5 minor intermediate term upcycle (see latest 1 year charts, http://www.joefrocks.com/GoldStockCharts.html ) began on 3-10-06 shortly after the XAU filled it's downside gap at 122.49 from 12-22. HUI's monthly upcycle (since 3-10-06) may have peaked on Wednesday 5-3, NEM's monthly upcycle peaked on Monday 5-1, and the XAU's monthly upcycle may have peaked on Friday 5-5.

The NEM Lead Indicator was a very bearish -5.09% vs the XAU this week and the US Dollar is due to bounce. The Bulls will probably get gored next week, and, this week it was aggressive Fed lending ($19.25 Billion in repos on 5-4 and Tuesday through Friday saw aggressive Fed lending) and a very strong Barrick (ABX) after a good earnings report that kept things together. The latest COT data (http://www.cftc.gov/dea/options/deacmxsof.htm) is bearish/mixed, portending weakness accompanied by some strength in gold next week, but, most of the strength probably occurred this week, since the data is 3 days old when released on Friday and a spike move occurred this week. The gold Commercial Traders added 5401 long futures and options contracts and added 7399 short futures and options contracts which portends weakness this week (non contrarian indicator), but the long trade points to some strength. See 5 day HUI chart: http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c= ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = +0.10% Vs The XAU Today

The NEM Lead Indicator = -1.00% vs the XAU yesterday, -1.53% vs the XAU on Wednesday, -1.46% vs the XAU on Tuesday, -1.20% vs the XAU on Monday, and -1.10% vs the XAU on Friday 4-28. So, a sharp decline in HUI/NEM/XAU is likely on Monday. The NEM Lead Indicator has been very bearish recently which points to a very sharp decline next week.The monthly cycle probably peaked today for XAU, Wednesday for HUI, and on Monday for NEM. HUI/NEM/XAU are probably in a Wave A short term downcycle. Fed Credit rose +$2.991 Billion in the WE 5-3 which is probably factored in to HUI/NEM/XAU since their monthly cycles have probably peaked: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

Barrick (ABX) And Fed Credit Held Things Together This Week

If it wasn't for Barrick's strong performance since releasing a good earnings report and the Fed's punch spiking the past 4 sessions, http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE,
the gold/silver stock market would have been much weaker. The XAU Made A slightly higher cycle high today than yesterday. So, the XAU is probably putting in a monthly cycle high today. HUI probably put in a monthly cycle high on Wednesday, and, NEM hit a monthly cycle high on Monday, leading as usual. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

The Fed spiked the punch as they always seem to do on Thursday, with a massive $19.25 Billion in Repos. The prior few days were respectable also. It appears to be plunge protection at work, but all it does is delay the process: http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.55293 today and XAU Implied Volatility closed at 37.205 on Thursday, which is a very high level of fear.

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle.

The NEM Lead Indicator is a bearish -0.50% vs the XAU right now, was a very bearish -1.00% vs the XAU on 5-4, was a very bearish -1.53% vs the XAU on 5-3, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28.

The latest COT data (as of 4-25-06) is short term bullish since the gold Commercial Traders traded net long and the gold Speculators traded net short, both of which portend strength this week, but much of the strength may have occurred last week because the data is three days old when released and gold spiked sharply higher late last week. The gold Commercial Traders added 5828 long futures and options contracts and covered 1404 short futures and options contracts which portends strength this week (non contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released. The gold Speculators (hedge funds and other speculators/traders) sold 5354 long futures and options contracts and covered 1435 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = ~ -1.00% Vs The XAU Today

The XAU's closing value isn't available, but the NEM Lead Indicator was probably -1.00%+ vs the XAU today, -1.53% vs the XAU yesterday, -1.46% vs the XAU on Tuesday, -1.20% vs the XAU on Monday, and -1.10% vs the XAU on Friday 4-28. So, a sharp decline in HUI/NEM/XAU is likely tomorrow. The NEM Lead Indicator has been very bearish the past 5 sessions which points to a very sharp decline during the next few days.The monthly cycle probably peaked today for XAU, yesterday for HUI, and on Monday for NEM. HUI/NEM/XAU are probably in a Wave A short term downcycle.

Fed Credit rose +$2.991 Billion in the WE 5-3 which is probably factored in to HUI/NEM/XAU since their monthly cycles have probably peaked: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

Big Time NEM Sell Interest Again Today At Lycos Thomson I Watch

The past week+ has seen big time sell interest and the few weeks before that also saw strong NEM sell interest, see http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=9&y=5 This is the strongest NEM sell interest I've seen in at least a few months and maybe much longer, which supports the substantial correction scenario, as does a very bearish NEM Lead Indicator in recent months, and, the USD which is due to rebound sharply.

The gold/silver sector needs to get spanked right now due to the extreme complacency. I seem to be the lone short term bear. If you don't understand cycle trendlines and the nature of cycles, with a big assist from Elliot Wave (See http://www.joefrocks.com/GoldStockCharts.html for all the charts.), you won't know when to turn bearish. ....... http://www.JoeFRocks.com/

Margins for Gold and Silver Futures Contracts to be Increased on NYMEX

This is a market that's due to correct anyway, but the strength is scaring some folks:

"The New York Mercantile Exchange, Inc. today announced margin changes for its gold and silver futures contracts, effective as of the close of business tomorrow. Margins for the May, June, August, October, and December 2006 gold futures contracts will increase to $2,750 from $2,250 for clearing and non-clearing members and to $3,713 from $3,038 for customers. All other months will remain unchanged. Margins for the May, June, July, and September 2006 silver futures contracts will increase to $6,000 from $4,500 for clearing and non-clearing members and to $8,100 from $6,075 for customers. All other months will remain unchanged."

....... http://www.JoeFRocks.com/

..........The XAU Made A Slightly Higher Cycle High Today

Than yesterday. So, the XAU is probably putting in a monthly cycle high today. Barrick (ABX) is having a good day so far which has helped a lot. They had a good earnings report. HUI made a slightly higher cycle high yesterday than the one on Monday, so a monthly cycle high probably occurred yesterday for HUI, and, NEM hit a monthly cycle high on Monday, leading as usual. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

The Fed spiked the punch today as they always seem to do on Thursday, with a massive $19.25 Billion in Repos. The prior few days were respectable also. It appears to be plunge protection at work, but all it does is delay the process: http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.45509 today and XAU Implied Volatility closed at 37.785 on Wednesday, which is a very high level of fear.

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 55.42 from 4-21, at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle.

The NEM Lead Indicator is a very bearish -1.60% vs the XAU right now, was a very bearish -1.53% vs the XAU on 5-3, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28, was a very bullish +1.16% vs the XAU on 4-27, was a bullish +0.41% vs the XAU on 4-26, was a bearish -0.32% vs the XAU on 4-25, was a bearish -0.59% vs the XAU on 4-24, was a bullish +0.40% vs the XAU on 4-21, was a bullish +0.96% vs the XAU on 4-20, was a bearish -0.70% vs the XAU on 4-19, was a bearish -0.48% vs the XAU on 4-18, after being a very bullish +1.76% vs the XAU on Monday 4-17.

The latest COT data (as of 4-25-06) is short term bullish since the gold Commercial Traders traded net long and the gold Speculators traded net short, both of which portend strength this week, but much of the strength may have occurred last week because the data is three days old when released and gold spiked sharply higher late last week. The gold Commercial Traders added 5828 long futures and options contracts and covered 1404 short futures and options contracts which portends strength this week (non contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released. The gold Speculators (hedge funds and other speculators/traders) sold 5354 long futures and options contracts and covered 1435 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = -1.53% Vs The XAU Today

The NEM Lead Indicator = -1.46% vs the XAU yesterday. The NEM Lead Indicator = -1.20% vs the XAU on Monday. The NEM Lead Indicator = -1.10% vs the XAU on Friday. So, a sharp decline in HUI/NEM/XAU is likely tomorrow. The NEM Lead Indicator has been very bearish the past 4 sessions which points to a very sharp decline during the next few days.

The monthly cycle probably peaked today for HUI/XAU and on Monday for NEM. HUI/NEM/XAU are probably in a Wave A short term downcycle. Fed Credit fell -$3.555 Billion in the WE 4-26 which portends a sharp decline this week: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

NEM Filled It's Downside Gap At 55.42 From 4-21

NEM is leading to the downside. The NEM Lead Indicator is very bearish again today for the fourth straight session. Buckle up!

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle. ....... http://www.JoeFRocks.com/

Big Time NEM Sell Interest Again Today At Lycos Thomson I Watch

The past week+ has seen big time sell interest and the few weeks before that also saw strong NEM sell interest, see http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=9&y=5 This is the strongest NEM sell interest I've seen in at least a few months and maybe much longer, which supports the substantial correction scenario, as does a very bearish NEM Lead Indicator in recent months, and, the USD which is due to rebound sharply.

The gold/silver sector needs to get spanked right now due to the extreme complacency. I seem to be the lone short term bear. If you don't understand cycle trendlines and the nature of cycles, with a big assist from Elliot Wave (See http://www.joefrocks.com/GoldStockCharts.html for all the charts.), you won't know when to turn bearish. ....... http://www.JoeFRocks.com/

..........The Monthly Cycle Probably Peaked Today

For HUI/XAU, which made slightly higher cycle highs than those on Monday, and NEM hit a monthly cycle high on Monday, leading as usual.

See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.52916 today and XAU Implied Volatility closed at 37.780 on Tuesday, which is a very high level of fear.

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 55.42 from 4-21, at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle.

The NEM Lead Indicator is a bearish -0.70% vs the XAU right now, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28, was a very bullish +1.16% vs the XAU on 4-27, was a bullish +0.41% vs the XAU on 4-26, was a bearish -0.32% vs the XAU on 4-25, was a bearish -0.59% vs the XAU on 4-24, was a bullish +0.40% vs the XAU on 4-21, was a bullish +0.96% vs the XAU on 4-20, was a bearish -0.70% vs the XAU on 4-19, was a bearish -0.48% vs the XAU on 4-18, after being a very bullish +1.76% vs the XAU on Monday 4-17.

The latest COT data (as of 4-25-06) is short term bullish since the gold Commercial Traders traded net long and the gold Speculators traded net short, both of which portend strength this week, but much of the strength may have occurred last week because the data is three days old when released and gold spiked sharply higher late last week. The gold Commercial Traders added 5828 long futures and options contracts and covered 1404 short futures and options contracts which portends strength this week (non contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released. The gold Speculators (hedge funds and other speculators/traders) sold 5354 long futures and options contracts and covered 1435 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = -1.46% Vs The XAU Today

The NEM Lead Indicator = -1.20% vs the XAU on Monday. The NEM Lead Indicator = -1.10% vs the XAU on Friday. So, a sharp decline in HUI/NEM/XAU is likely tomorrow. The NEM Lead Indicator has been very bearish the past 3 sessions which points to a very sharp decline during the next few days.

The monthly cycle probably peaked yesterday for HUI/NEM/XAU shortly after the XAU filled the last of the recently created upside gaps at 159.93 from 4-20. Often cycle highs/lows occur shortly (in this case about 20 minutes) after the last of recently created gaps get filled. So, HUI/NEM/XAU are probably in a Wave A short term downcycle that has begun very flat, but, there was a sharp intraday decline followed by a sharp rebound today. After plunging today HUI/NEM/XAU rebounded to their monthly downcycle trendlines.

Fed Credit fell -$3.555 Billion in the WE 4-26 which portends a sharp decline this week: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

.........The Monthly Upcycle Appears To Be Toast

Probably peaked yesterday for HUI/NEM/XAU. The XAU filled downside gaps at at 158.90 from 5-2 and at 158.11 from 5-1 today, and, NEM filled it's downside gap at 56.72 from 4-28 today. The NEM Lead Indicator is a very bearish -1.00% vs the XAU right now.

The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 55.42 from 4-21, at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle. ....... http://www.JoeFRocks.com/

Big Time NEM Sell Interest Again Today At Lycos Thomson I Watch

The past week has seen big time sell interest and the few weeks before that also saw strong NEM sell interest, see http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=9&y=5 This is the strongest NEM sell interest I've seen in at least a few months and maybe much longer, which supports the substantial correction scenario, as does a very bearish NEM Lead Indicator in recent months, and, the USD which is due to rebound sharply.

The gold/silver sector needs to get spanked right now due to the extreme complacency. I seem to be the lone short term bear. If you don't understand cycle trendlines and the nature of cycles, with a big assist from Elliot Wave (See http://www.joefrocks.com/GoldStockCharts.html for all the charts.), you won't know when to turn bearish. ....... http://www.JoeFRocks.com/

..........The Monthly Cycle Probably Peaked Yesterday

In rollover mode for HUI/NEM/XAU, which made modestly higher cycle highs than those on 4-19, and, the XAU probably put in a monthly cycle high about 20 minutes after filling it's upside gap at 159.93 from 4-20. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.46790 today and XAU Implied Volatility closed at 38.400 on Monday, which is a very high level of fear.

The XAU has downside gaps at 158.90 from 5-2, at 158.11 from 5-1, at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 56.72 from 4-28, at 55.42 from 4-21, at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle.

The NEM Lead Indicator is a slightly bearish -0.15% vs the XAU right now, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28, was a very bullish +1.16% vs the XAU on 4-27, was a bullish +0.41% vs the XAU on 4-26, was a bearish -0.32% vs the XAU on 4-25, was a bearish -0.59% vs the XAU on 4-24, was a bullish +0.40% vs the XAU on 4-21, was a bullish +0.96% vs the XAU on 4-20, was a bearish -0.70% vs the XAU on 4-19, was a bearish -0.48% vs the XAU on 4-18, after being a very bullish +1.76% vs the XAU on Monday 4-17.

The latest COT data (as of 4-25-06) is short term bullish since the gold Commercial Traders traded net long and the gold Speculators traded net short, both of which portend strength this week, but much of the strength may have occurred last week because the data is three days old when released and gold spiked sharply higher late last week. The gold Commercial Traders added 5828 long futures and options contracts and covered 1404 short futures and options contracts which portends strength this week (non contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released. The gold Speculators (hedge funds and other speculators/traders) sold 5354 long futures and options contracts and covered 1435 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/

The NEM Lead Indicator = -1.20% Vs The XAU Today

The NEM Lead Indicator = -1.10% vs the XAU on Friday. So, a sharp decline in HUI/NEM/XAU is likely tomorrow. The monthly cycle probably peaked today for HUI/NEM/XAU shortly after the XAU filled the last of the recently created upside gaps at 159.93 from 4-20. Often cycle highs/lows occur shortly (in this case about 20 minutes) after the last of recently created gaps get filled.

Fed Credit fell -$3.555 Billion in the WE 4-26 which portends a sharp decline this week: http://www.federalreserve.gov/releases/h41/Current/ See 5 day chart for recent action: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c= . ....... http://www.JoeFRocks.com/

Big Time NEM Sell Interest At Lycos Thomson I Watch

Recently, see http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=9&y=5 This is the strongest NEM sell interest I've seen in at least a few months and maybe much longer, which supports the substantial correction scenario, as does a very bearish NEM Lead Indicator in recent months, and, the USD which is due to rebound sharply. The gold/silver sector needs to get spanked right now also due to the extreme complacency. ....... http://www.JoeFRocks.com/

........The XAU Filled It's Upside Gap At 159.93 Today

Often cycle highs/lows occur shortly after the last of recently created gaps is filled. Thursday 4-20's upside gap at 159.93 for the XAU was the last of the recently created upside gaps, so, the monthly cycle may have peaked today. The Fed has been doing average lending since last Thursday, and, for the week ending 4-26 Fed Credit shrank -$3.555 Billion, so, Fed Credit portends weakness this week. The important factors pointing to a 10-20% correction are a very bearish NEM Lead Indicator in recent months, strong NEM sell interest at Lycos Thomson I Watch the past few weeks, and, the USD has been plunging in a Wave C down and is due to rebound sharply, which should send gold substantially lower. Another important factor is the extreme bullishness right now. Who besides myself is bearish short term??? I seem to be the only one looking for a substantial corection right now. ....... http://www.JoeFRocks.com/

.....................The Monthly Cycle Is Peaking

HUI and the XAU took out their 4-19 cycle highs today and NEM did so on Friday. Notice that NEM is leading as usual.

See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=

A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.49270 today and XAU Implied Volatility closed at 37.720 on Friday, which is a very high level of fear.

The XAU has downside gaps at 158.11 from 5-1, at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 58.36 from 5-1, at 56.72 from 4-28, at 55.42 from 4-21, at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some of which will get filled in this monthly downcycle.

The NEM Lead Indicator is a bearish -0.45% vs the XAU right now, was a very bearish -1.10% vs the XAU on 4-28, was a very bullish +1.16% vs the XAU on 4-27, was a bullish +0.41% vs the XAU on 4-26, was a bearish -0.32% vs the XAU on 4-25, was a bearish -0.59% vs the XAU on 4-24, was a bullish +0.40% vs the XAU on 4-21, was a bullish +0.96% vs the XAU on 4-20, was a bearish -0.70% vs the XAU on 4-19, was a bearish -0.48% vs the XAU on 4-18, after being a very bullish +1.76% vs the XAU on Monday 4-17.

The latest COT data (as of 4-25-06) is short term bullish since the gold Commercial Traders traded net long and the gold Speculators traded net short, both of which portend strength this week, but much of the strength may have occurred last week because the data is three days old when released and gold spiked sharply higher late last week. The gold Commercial Traders added 5828 long futures and options contracts and covered 1404 short futures and options contracts which portends strength this week (non contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released. The gold Speculators (hedge funds and other speculators/traders) sold 5354 long futures and options contracts and covered 1435 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released.

There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next week or two are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/