The Gold COT (Commitment of Traders) Data Is Mixed
I continue to be very impressed with the generally non contrarian gold Commercial Traders. In the week ending 9-26-06 they sold 5,593 long futures and options contracts and covered 9,058 futures and options contracts (see http://www.cftc.gov/dea/options/deacmxsof.htm), correctly anticipating gold's strength last week, but also looking for substantial weakness in the near future by liquidating a significant part of their long position.In evaluating the COT data and the indicators the most important consideration is cycles, which is Wave C down (probably began on Thursday for HUI/XAU) of Wave A of their (HUI/XAU) Wave 2 Cyclical Bear Market since 5-11-06 (see second chart at http://www.joefrocks.com/GoldStockCharts.html). So, while the significant short covering and the fact that they traded net long by 3465 futures and options contracts points to some strength next week, the tone next week could and probably will end up being weakness (potentially severe) rather than strength.The past fifteen weeks the NEM Lead Indicator is a very bearish -17.16% 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 C down/another brutal decline may have begun on Thursday 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
The NEM Lead Indicator Was A Modestly Bearish -0.22% Vs The XAU Today
The NEM Lead Indicator was a modestly bearish -0.22% vs the XAU today, but, for the week the NEM Lead Indicator was a very bearish -4.46% vs the XAU, which means that most of the buy the dips crowd/perma Bulls that're still standing will probably be obliterated in the next week or so. 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. HUI/XAU probably entered Wave C down yesterday of the major downcycle since 9-6, in which Wave A of their Cyclical Bear Market since 5-11-06 will bottom, probably in the 100-110 range for the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. The NEM Lead Indicator was a "very bullish" +1.05% vs the XAU yesterday, but, was simply "correcting" for Wednesday's incredibly bearish -3.49% vs the XAU, due to NEM's bad news (please see Wednesday's post regarding this if you're interested). The NEM Lead Indicator was a very bearish -1.10% vs the XAU on Tuesday, was a bearish -0.70% vs the XAU on Monday, and, was a bearish -0.57% vs the XAU on Friday 9-22. The past fifteen weeks the NEM Lead Indicator is a very bearish -17.16% 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 C down/another brutal decline may have begun on Thursday 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
............The Elliot Wave 2 Cyclical Bear Market
The Elliot Wave 2 Cyclical Bear Market began on 1-31-06 for reliable lead indicator NEM (see first chart at http://www.joefrocks.com/GoldStockCharts.html) and on 5-11-06 for HUI/XAU (see second chart at http://www.joefrocks.com/GoldStockCharts.html). Secular Bull (or Bear) Markets/very long term upcycles last about 17.2 years on average for the major averages, and, last about the same for the gold/silver sector. Gold's Secular Bear Market/very long term downcycle lasted from 1980 until April 2001, when a Secular Bull Market began (gold stocks led, with a Secular Bull Market beginning in late 2000 for HUI/NEM/XAU). I think gold actually bottomed in 1999, but, didn't begin acting like it was in a Bull Market until after the April 2001 cycle low. After the 1999 cycle low gold had a huge spike, then resumed a Bear Market until April 2001.Secular Bull Markets/very long term upcycles do experience occasional Cyclical Bear Markets that, from a very long term perspective, are corrections within the Secular Bull Market. This is what's going on since 5-11-06 for HUI/XAU and since 1-31-06 for reliable lead indicator NEM, a Wave 2 Cyclical Bear Market, or the first "correction" from a very long term 15-20 year+ point of view.The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. 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 may have begun on Thursday 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
Complacency Crept Into The XAU On Thursday!
XAU Implied Volatility fell -0.90% to 36.920 on Thursday from 37.255 on Wednesday despite a -0.61% decline in the XAU, which is a significant (0.50-1.99%) +1.51% rise in complacency that portends some weakness on Friday, since the XAU wall of worry fell by -1.51% (= -0.90% + -0.61%). The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. 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 may have begun on Thursday 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
The NEM Lead Indicator Was A Misleadingly Bullish +1.05% Vs The XAU Today
The NEM Lead Indicator was a "very bullish" +1.05% vs the XAU today, but, was simply "correcting" for yesterday's incredibly bearish -3.49% vs the XAU, due to NEM's bad news (please see yesterday's post regarding this if you're interested). The NEM Lead Indicator was a very bearish -1.10% vs the XAU on Tuesday, was a bearish -0.70% vs the XAU on Monday, and, was a bearish -0.57% vs the XAU on Friday. The past fourteen weeks and four days the NEM Lead Indicator is a very bearish -16.94% versus the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. HUI/NEM/XAU hit the bottom of their short term downtrending channels on Monday (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=), making new cycle lows for this major downcycle (since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM). NEM made a new cycle low at 41.75 yesterday versus 42.20 on Monday.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 may have begun today 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
The Wave B Short Term Upcycle Since Early Monday Appears To Have Peaked
HUI/XAU's Wave B short term upcycle (of the major downcycle since 9-6) since early Monday appears to have peaked, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=. Wave B rolled over as the week progressed and appears to have peaked today. The sideways action today is typical of what occurs near cycle highs/lows (the flat topping part of the cycle). If Wave C has begun then HUI/XAU should experience a dramatic decline during the next week or so, in which Wave A of their Cyclical Bear Market since 5-11-06 bottoms, probably in the 100-110 range for the XAU. ....... http://www.JoeFRocks.com/HUI NEM XAU
HUI/XAU Strength Since Monday's Cycle Lows Is Probably Wave B
HUI/XAU strength since Monday's cycle lows is probably wave B of the major downcycle since 9-6, whereas reliable lead indicator NEM is already in Wave C of the major downcycle since 9-5 (NEM's started a day before HUI/XAU), hitting 41.75 yesterday versus 42.20 on Monday. If so then the next week or so will be the brutal wave C in which the XAU may fall to 100-110, which jives with the very bearish NEM Lead Indicator since last Friday (see next paragraph). The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85-90ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. The NEM Lead Indicator was a very bearish -3.49% vs the XAU yesterday, was a very bearish -1.10% vs the XAU on Tuesday, was a bearish -0.70% vs the XAU on Monday, and, was a bearish -0.57% vs the XAU on Friday. The past fourteen weeks and three days the NEM Lead Indicator is a very bearish -17.99% versus the XAU. HUI/NEM/XAU hit the bottom of their short term downtrending channels on Monday (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=), making new cycle lows for this major downcycle (since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM). 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 may still be in effect (may last a few more sessions), but it looks like Wave B began on Monday for HUI/XAU. 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
The NEM Lead Indicator Was A Very Bearish -3.49% Vs The XAU Today
The NEM Lead Indicator was a very bearish -3.49% vs the XAU today, was a very bearish -1.10% vs the XAU yesterday, was a bearish -0.70% vs the XAU on Monday, and, was a bearish -0.57% vs the XAU on Friday, which indicates that more wave A downside won't be surprising (reliable lead indicator NEM did so today, taking out Monday's cycle low (42.20), with a cycle low today at 41.75), or, at least a test of the cycle lows is likely. The past fourteen weeks and three days the NEM Lead Indicator is a very bearish -17.99% versus the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. HUI/NEM/XAU hit the bottom of their short term downtrending channels on Monday (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=), making new cycle lows for this major downcycle (since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM), and, rallied to the top of their short term downtrending channels today. 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 may still be 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
.................NEM Bad News A Factor Today
I think NEM would have been down significantly and possibly sharply anyway, but, there was bad news today that obviously contributed to NEM's mini crash from an early session cycle high at 44.15 to a session cycle low so far at 41.75, see http://www.rockymountainnews.com/drmn/local/article/0,1299,DRMN_15_5024691,00.html.
NEM has plunged to within shouting distance of it's Secular Bull Market/very long term upcycle trendline, currently at 41ish, see first chart at http://www.joefrocks.com/GoldStockCharts.html. This means that NEM's Wave 2 Cyclical Bear Market since 1-31-06 is probably bottoming, and, may bottom today or in the next few sessions, and, that HUI/XAU's Wave 2 Cyclical Bear Market since 5-11-06 will probably be 9-18 months instead of over 18 months. ....... http://www.JoeFRocks.com/
HUI NEM XAU
NEM Plunges And Takes Out Monday's Cycle Low!
Reliable lead indicator NEM plunged from a cycle high at 44.15 early today to a cycle low so far at 41.75 (a -5.44% decline) so fast it was scary and surreal. It went through Monday's cycle low at 42.20 like a buzz saw through butter. NEM's Wave 2 Cyclical Bear Market since 1-31-06 is probably bottoming, and, may bottom today, since it's Secular Bull Market/very long term upcycle trendline is currently at 41ish, see first chart at http://www.joefrocks.com/GoldStockCharts.html. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind.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
The NEM Lead Indicator Is A Very Bearish -2.05% Vs The XAU Right Now
A test of Monday's cycle lows may occur today or tomorrow, given the very bearish NEM Lead Indicator so far today (-2.05%% vs the XAU right now) and the prior three sessions. The NEM Lead Indicator was a very bearish -1.10% vs the XAU yesterday, was a bearish -0.70% vs the XAU on Monday, and, was a bearish -0.57% vs the XAU on Friday, which indicates that more wave A downside won't be surprising, or, at least a test of the cycle lows is likely. The past fourteen weeks and two days the NEM Lead Indicator is a very bearish -14.50% versus the XAU (-16.55% right now). The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. HUI/NEM/XAU hit the bottom of their short term downtrending channels on Monday (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=), making new cycle lows for this major downcycle (since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM), and, rallied to the top of their short term downtrending channels today. 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 may still be 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
The NEM Lead Indicator Was A Very Bearish -1.10% Vs The XAU Today
The NEM Lead Indicator was a very bearish -1.10% vs the XAU today, was a bearish -0.70% vs the XAU yesterday, and, was a bearish -0.57% vs the XAU on Friday, which indicates that more wave A downside on Wednesday won't be surprising, or, at least a test of the cycle lows is likely. The past fourteen weeks and two days the NEM Lead Indicator is a very bearish -14.50% versus the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. HUI/NEM/XAU hit the bottom of their short term downtrending channels yesterday (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=), making new cycle lows for this major downcycle (since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM), and, rallied to the top of their short term downtrending channels today. HUI/NEM/XAU's very short term upcycle rolled over dramatically late today, so, a test of yesterday's cycle lows may occur tomorrow, especially given the very bearish NEM Lead Indicator today (-1.10% vs 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 may still be 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
The NEM Lead Indicator Is A Bearish -0.76% Vs The XAU Right Now
The NEM Lead Indicator is a bearish -0.76% vs the XAU right now, was a bearish -0.70% vs the XAU yesterday, and, was a bearish -0.57% vs the XAU on Friday, which indicates that more wave A downside this week won't be surprising, or, at least a test of the Wave A cycle lows that occurred yesterday is likely.
NEM filled it's upside gap at 43.78 today, so, maybe NEM bottomed yesterday at 42.20, which is potentially the end (or nearly so) of reliable lead indicator NEM's Wave 2 Cyclical Bear Market since 1-31-06, since NEM's Secular Bull Market/very long term upcycle trendline is currently at 41ish, see first chart at http://www.joefrocks.com/GoldStockCharts.html.
The past fourteen weeks and one day the NEM Lead Indicator is a very bearish -13.40% versus the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind.
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 may still be 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
NEM Has Failed So Far To Fill It's Upside Gap At 43.78, That Was Created At Yesterday's Open
NEM failed late yesterday and failed again early today to fill it's upside gap at 43.78 from yesterday's open, which is a bearish sign that indicates a test of yesterday's Wave A cycle lows (NEM's was 42.20) is likely.After an initial 4 dayish dramatic nearly vertical plunge, the major downcycle since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM has settled into a fairly well defined downtrending channel, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=. Once/if HUI/NEM/XAU's channels are broken to the upside one can look to (key words) trade long, but keep in mind that Wave C of the major downcycle since 9-6 lies ahead. I said once/if because they could break below those channels in a final capitulation phase of Wave A for HUI/XAU and for what now looks like it could be Wave C for NEM (or NEM may put in a modestly lower cycle low in Wave C), since it fell to 42.20 yesterday, fairly close to it's Secular Bull Market/very long term upcycle trendline at 41ish, see the first chart at http://www.joefrocks.com/GoldStockCharts.html.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 may still be 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
HUI/NEM/XAU's Short Term Downtrending Channels
After an initial 4 dayish dramatic nearly vertical plunge, the major downcycle since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM has settled into a fairly well defined downtrending channel, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=. Once/if HUI/NEM/XAU's channels are broken to the upside one can look to (key words) trade long. I said once/if because they could break below those channels in a final capitulation phase of Wave A for HUI/XAU and for what now looks like it could be Wave C for NEM (or NEM may put in a modestly lower cycle low in Wave C), since it fell to 42.20 today, fairly close to it's Secular Bull Market/very long term upcycle trendline at 41ish, see the first chart at http://www.joefrocks.com/GoldStockCharts.html.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 may still be 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
The NEM Lead Indicator Was A Bearish -0.70% Vs The XAU Today
The NEM Lead Indicator was a bearish -0.70% vs the XAU today, and, was a bearish -0.57% vs the XAU on Friday, which indicates that more wave A downside on Tuesday won't be surprising, or, at least a test of the cycle lows is likely. The past fourteen weeks and one day the NEM Lead Indicator is a very bearish -13.40% versus the XAU. The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish (see second chart at http://www.joefrocks.com/GoldStockCharts.html), so, please keep that in mind. 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 may still be 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
.............Some Great News Amidst The Gloom
Reliable lead indicator NEM's cycle low today is 42.20, which is close to it's Secular Bull Market/very long term upcycle trendline at 41ish, see the first chart at http://www.joefrocks.com/GoldStockCharts.html. This means that reliable lead indicator NEM's Wave 2 Cyclical Bear Market since 1-31-06 is probably just about over, and, that HUI/XAU's Wave 2 Cyclical Bear Market since 5-11-06 is more likely to be 9-18 months than 18-24+ months. NEM has to bounce at it's Secular Bull Market/very long term upcycle trendline at 41ish and hit a 5% follow through buy signal (a major buy signal) before Trade the Cycles indicates that NEM has entered Wave 3 of it's Secular Bull Market/very long term upcycle since October 2000. ....... http://www.JoeFRocks.com/HUI NEM XAU
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
Very Important Big Picture Trade The Cycles Charts
I've done annotated very long term Trade the Cycles charts for NEM/XAU that provide a great idea as to what's going on now, and, why HUI/XAU still have a ways to go to reach their Secular Bull Market/very long term upcycle trendlines. See the top two Trade the Cycles charts: http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market may end up being only about 9 months if NEM hits 41ish in the next few weeks (it's Secular Bull Market trendline), which would make sense since NEM, being a reliable lead indicator, should hit a Wave 2 cycle low well ahead of HUI/XAU. The target range for the XAU's 18 monthish Wave 2 Cyclical Bear Market cycle low is 95-100.The XAU's Secular Bull Market/very long term upcycle trendline is currently at 85ish versus the XAU's close at 125.81 on 9-22-06.The reason why most "Elliot Wavers" fail is because they rarely understand cycles, hence they tend to get the Elliot Wave count wrong because they start at the wrong time. Any stocks that have completed an 18 monthish Cyclical Bear Market in the past year or two are trading/investing candidates, then you do your due diligence. CDE for example completed a 16 monthish Cyclical Bear Market in mid 2005 if I remember correctly. ....... http://www.JoeFRocks.com/HUI NEM XAU
The NEM Lead Indicator Portends Some Weakness This Week
The NEM Lead Indicator portends some weakness this week (but all indicators and cycle channels/trendlines (most important consideration, plus Elliot Wave patterns and gaps) must be considered collectively, not in isolation. Think "system."), since NEM underperformed the XAU last week by -0.46% and underperformed the XAU on Friday by -0.57%: -0.11% (NEM) vs +0.46% (XAU) on 9-22, +1.48% vs +1.05% on 9-21, -0.44% vs -0.65% on 9-20, -3.21% vs -4.24% on 9-19, +1.52% vs +3.08% on 9-18. ....... http://www.JoeFRocks.com/ NEM XAU
The COT Data Portends Weakness Followed By Strength Next Week
The COT (Commitments Of Traders) data portends weakness followed by strength next week, see http://www.cftc.gov/dea/options/deacmxsof.htm. The unusually large (> 10% increase) increase in the normally non contrarian gold Commercial Traders' long position points to some significant weakness this week, as does the significant short selling. They added 13,431 long futures and options contracts and they added 4,472 short futures and options contracts. The net long increase of 8959 futures and options contracts points to strength in the near future, after likely weakness early next week. The contrarian gold Speculators traded net short, which points to strength next week, but the short covering (924 futures and options contracts) points to some weakness. ....... http://www.JoeFRocks.com/COT gold
A Significant (0.50-1.99%) +0.74% Rise In Complacency Occurred For The XAU On Friday
XAU Implied Volatility fell -1.20% to 35.770 on Friday 9-22 from 36.205 on 9-21 versus a +0.46% rise in the XAU on 9-22, which is a significant (0.50-1.99%) +0.74% rise in complacency (-1.20% + +0.46% = -0.74%. The XAU wall of worry shrank by -0.74%, therefore complacency rose by +0.74%) that portends weakness/a downtrend during part of Monday 9-25's session (complacency is usually contrarian, therefore normally portends weakness, until it reachs an unusually large level (> 6% increase) where it becomes non contrarian). That weakness/a downtrend could follow a gap up at the open and early strength. XAU Implied Volatility tends to indicate a trend/tone rather than necessarily a simplistic up or down session. The XAU Put/Call Ratio is another very important indicator that may disagree with XAU Implied Volatility. These indicators must be used in concert with cycle channels/trendlines (very long term, cyclical Bull/Bear, long term, major intermediate term, minor intermediate term, monthly, short term, and very short term), which are the primary market timing consideration (Elliot Wave patterns and gaps are very important considerations that complement cycle channels/trendlines). See the Trade the Cycles charts for cycle channels/trendlines used in concert with Elliot Wave patterns: http://www.joefrocks.com/GoldStockCharts.html. The reason why most "Elliot Wavers" fail is because they rarely understand cycles, hence they tend to get the Elliot Wave count wrong because they start at the wrong time. Any stocks that have completed an 18 monthish Cyclical Bear Market in the past year or two are trading/investing candidates, then you do your due diligence. CDE for example completed a 16 monthish Cyclical Bear Market in mid 2005 if I remember correctly. ....... http://www.JoeFRocks.com/.XAU
............Weakness Likely Early On Monday
The NEM Lead Indicator was a bearish -0.57% vs the XAU today, which indicates that more wave A downside on Monday won't be surprising, or, at least a test of the cycle lows is likely. The NEM Lead Indicator was a modestly bullish +0.43% vs the XAU yesterday, was a slightly bullish +0.21% vs the XAU on Wednesday, was a very bullish +1.03% vs the XAU on Tuesday, was a very bearish -1.56% versus the XAU on Monday after being a bearish -0.65% versus the XAU on Friday 9-15. 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 may still be 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
Reliable Lead Indicator NEM Is Leading To The Downside Right Now
Reliable lead indicator NEM is leading to the downside right now, with the NEM Lead Indicator at -0.75% versus the XAU. Wave B up of the major downcycle since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM) may have begun yesterday (Wednesday for reliable lead indicator NEM), but, a test appears likely late today or early on Monday. Caution is in order to put it mildly. ....... http://www.JoeFRocks.com/HUI NEM XAU
.......NEM Filled Today's Downside Gap At 43.83
The XAU may fill it's downside gap at 125.24 that was created at today's open. It looks like the Fed will provide no credit to index fund traders today, for the second time this week, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. It's been a rare occasion that they've provided no credit, but this week they've done it twice, and, yesterday's $8 Billion versus the typical $13-14 Billion for a Thursday is more evidence that they want a correction.
The NEM Lead Indicator was a modestly bullish +0.43% vs the XAU yesterday, which indicates that more wave A downside today won't be surprising. The NEM Lead Indicator was a slightly bullish +0.21% vs the XAU on Wednesday, was a very bullish +1.03% vs the XAU on Tuesday, was a very bearish -1.56% versus the XAU on Monday after being a bearish -0.65% versus the XAU on Friday 9-15. The past thirteen weeks and four days the NEM Lead Indicator is a very bearish -12.13% 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 may still be 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
Many Gold/Silver Stocks Remain In A Cyclical Bull Market
If you read this post before, I added a "bunch of stuff."Many gold/silver stocks remain in a Cyclical Bull Market, which last about 3 to 6 years in a Secular Bull Market/very long term upcycle. In a Secular Bull Market/very long term upcycle there's likely to be 3 five yearish Cyclical Bull Markets corresponding to Elliot Waves 1 (ended 5-11-06 for HUI/XAU and 1-31-06 for reliable lead indicator NEM), 3, and 5, and, two 18 monthish Cyclical Bear Markets corresponding to Elliot Waves 2 and 4 down. Cyclical Bull Markets will tend to be much longer in a Secular Bull Market than in a Secular Bear Market, for obvious reasons.Very long term upcycles and downcycles (Secular Bull and Bear Markets) last about 15-20 years. They average 17.2 years for the major averages according to some analysts I've read.Elliot Wave works well and is highly useful ONLY if you understand cycles. See the Trade the Cycles charts and note the Elliot Wave patterns: http://www.joefrocks.com/GoldStockCharts.html. The reason why most "Elliot Wavers" fail is because they rarely understand cycles, hence they tend to get the Elliot Wave count wrong because they start at the wrong time.Any stocks that have completed an 18 monthish Cyclical Bear Market in the past year or two are trading/investing candidates, then you do your due diligence. CDE for example completed a 16 monthish Cyclical Bear Market in mid 2005 if I remember correctly. ....... http://www.JoeFRocks.com/CDE gold silver
HUI/XAU Made New Wave A Cycle Lows Today
The major downcycle's (since 9-6 for HUI/XAU and 9-5 for reliable lead indicator NEM) wave A lives. HUI and the XAU made new wave A cycle lows today, while NEM's cycle low from yesterday (at 43.12 I think) held. Depending on which way NEM breaks out of today’s intraday triangle will probably determine whether Wave A is still in effect for NEM and probably also HUI/XAU.The NEM Lead Indicator was a modestly bullish +0.43% vs the XAU today, which indicates that more wave A downside tomorrow won't be surprising. The NEM Lead Indicator was a slightly bullish +0.21% vs the XAU yesterday, which correctly indicated that more wave A downside today wouldn't be surprising.The NEM Lead Indicator was a very bullish +1.03% vs the XAU on Tuesday. The NEM Lead Indicator was a very bearish -1.56% versus the XAU on Monday after being a bearish -0.65% versus the XAU on Friday. The past thirteen weeks and four days the NEM Lead Indicator is a very bearish -12.13% 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 may still be 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
The 100-110 XAU Cyclical Bear Market Wave A Cycle Low Target Range
The XAU's very long term upcycle/Secular Bull Market (since October 2000) uptrend line is currently at 80-85ish. See the second chart at http://www.joefrocks.com/GoldStockCharts.html, which is from February of this year. The 100-110 XAU Cyclical Bear Market Wave A cycle low target range is an educated guess based on the obvious assumption that Wave A doesn't bring the XAU down to it's very long term upcycle/Secular Bull Market uptrend line, otherwise the Cyclical Bear Market would be over, and, it won't be Wave A it would be Wave C.The second chart from February shows that the Wave 5 long term upcycle was peaking, and, peaked on 5-11-06, which was a Wave 1 Cyclical Bull Market cycle high for the XAU and HUI (began late 2000). Reliable lead indicator NEM's Wave 1 Cyclical Bull Market cycle high occurred on 1-31-06 (began October 2000). The third chart shows the US Dollar putting in a major cycle low above it's previous one, indicating that the USD is in a Cyclical Bull Market, and, the fourth chart is the NEM Lead Indicator chart that reveals NEM dramatically leading to the downside months before the Wave 1 Cyclical Bull Market cycle highs for HUI/XAU.There shouldn't be much relief for longs until Wave A down of the Wave 2 Cyclical Bear Market (since 5-11-06 for HUI/XAU and since 1-31-06 for reliable lead indicator NEM) bottoms in the 100-110 range (XAU) in the next few weeks. 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 USD
...................Watch Today's Downside Gaps
At 43.19 for NEM and 123.94 for the XAU. XAU Implied Volatility portends some weakness today, because it fell modestly to 36.37 yesterday from 36.53 on Tuesday despite the XAU falling -0.65% yesterday, which is a significant rise in complacency that portends some weakness today. The XAU Put/Call Ratio revealed an unusually large rise in fear today which portends weakness, rising more than 6% from 0.84470 yesterday to 0.91662 today. Add to this below average Fed Credit for a Thursday (http://www.newyorkfed.org/markets/omo/dmm/temp.cfm), at $8 Billion versus the typical $13-14 Billion, and the fact that NEM and the XAU appear to be in the process of filling today's downside gaps, and there's no rush to even look to trade long. Fed credit was a measly $2 Billion the prior two days. The NEM Lead Indicator was a slightly bullish +0.21% vs the XAU yesterday, which indicates that more wave A downside today won't be surprising.The NEM Lead Indicator was a very bullish +1.03% vs the XAU on Tuesday. The NEM Lead Indicator was a very bearish -1.56% versus the XAU on Monday after being a bearish -0.65% versus the XAU on Friday. The past thirteen weeks and three days the NEM Lead Indicator is a very bearish -12.56% 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 may still be 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
...........The Major Downcycle's Wave A Lives
The major downcycle's (since 9-6 for HUI/XAU and 9-5 for reliable lead indicator NEM) wave A lives. HUI and NEM made new wave A cycle lows today, while the XAU's cycle low from last Friday barely held. The NEM Lead Indicator was a slightly bullish +0.21% vs the XAU today, which indicates that more wave A downside tomorrow won't be surprising.The NEM Lead Indicator was a very bullish +1.03% vs the XAU yesterday. The NEM Lead Indicator was a very bearish -1.56% versus the XAU on Monday after being a bearish -0.65% versus the XAU on Friday. The past thirteen weeks and three days the NEM Lead Indicator is a very bearish -12.56% 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 may still be 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
.................No Surprises From The Fed Today
From the AP:"The Fed is trying to engineer a soft-landing for the economy in which growth is slowed enough to keep inflation from getting out of hand without overdoing the credit tightening and raising the chances of a recession. In its statement, the Fed continued to signal concerns about inflation, repeating a phrase it had used last time -- that the Fed's rate setting panel "judges that some inflation risks remain.""Housing is imploding and commodity prices are plunging, but, the Fed says that some inflation risks remain? The current economic environment is very deflationary not inflationary. One of the Fed Governors even wanted to hike rates today??? What Kuiper Belt Object is that guy on? Yes, let's have a depression while we're at it........ http://www.JoeFRocks.com/Housing commodities Fed inflation
.........................Waitin On The Fed Baby
It's about an hour until the Fed makes their rate announcement (usually about 2:15 pm EST) accompanied by a statement. There will be no rate hike, but their view of the economy, inflation, and interest rates is always of interest, especially now. It'll be interesting to see if they comment on the housing implosion, and, if they try to minimize it's importance or minimize the actual magnitude of the downturn. They generally avoid scaring the markets like the plague, so, keep that in mind. I'll post their comments later and see if there's anything interesting/unexpected. Stay tuned! ....... http://www.JoeFRocks.com/Fed economy inflation rates housing
Probably Early Strength Followed By Weakness
The NEM Lead Indicator was a very bullish +1.03% vs the XAU yesterday, which correctly portended some strength today. The most important market timing consideration however is cycle trendlines, which tend to follow Elliot Wave patterns. The XAU Put/Call Ratio (October expiration) fell from 0.87327 yesterday to 0.84470 today, which portends some weakness today, and, XAU Implied Volatility rose significantly less yesterday (+3.02%, from 35.46 on Monday to 36.53 yesterday) than the XAU fell (-4.24%), which portends some weakness today, because the XAU wall of worry fell -1.22%, which is a significant (0.50-1.99%) rise in complacency.Wave A cycle lows for the major correction since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM) may have occurred yesterday for HUI and on Friday for the XAU. Reliable lead indicator NEM's major correction began on 9-5 and NEM may have put in a wave A cycle low yesterday. Fed Credit has been below average recently (none yesterday and a small $2 Billion 1 day Repo today). So, there's no rush to go long right now, especially with today being a Fed FOMC meeting. Most of you shouldn't be trading wave B up of a major correction long anyway. But, there are many gold/silver stocks that remain in Cyclical Bull Markets. Any stocks that have completed 18 monthish Cyclical Bear Markets in the past year or two are trading/investing candidates, then you do your due diligence. CDE for example completed a 16 monthish Cyclical Bear Market in mid 2005 if I remember correctly.The past thirteen weeks and two days the NEM Lead Indicator is a very bearish -12.77% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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 Fed credit
The NEM Lead Indicator Was a Very Bullish +1.03% Vs The XAU Today
HUI and NEM took out Friday's cycle lows, but, the XAU's Friday cycle low held today. HUI/NEM/XAU could be doing a double bottom cycle low for wave A down of their major correction since 9-6 for HUI/XAU and since 9-5 for reliable lead indicator NEM. Today's very bullish NEM Lead Indicator at +1.03% vs the XAU suggests that's a likely scenario. The NEM Lead Indicator was a very bearish -1.56% versus the XAU yesterday after being a bearish -0.65% versus the XAU on Friday. The past thirteen weeks and two days the NEM Lead Indicator is a very bearish -12.77% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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
.......The Housing Implosion And Gold/Silver Stocks
The housing implosion is deflationary, which is BAD for gold/silver stocks, which do well in an inflationary rising interest rate environment, which is the opposite of the current deflationary environment, seehttp://biz.yahoo.com/ap/060919/economy.html?.v=7. Here's a small part of the article: "Housing has just fallen off a precipice," said Mark Zandi, chief economist at Moody's Economy.com, who said he believed the central bank would discuss this slowdown in the statement it releases after Wednesday's meeting.
David Seiders, chief economist at the National Association of Home Builders, said the organization's survey of builder sentiment declined in September for the eighth consecutive month and now stands at its lowest point in more than 16 years.
"We have been warning that the housing downswing seems to be deeper than the Fed has been expecting and that the downside risks to housing are substantial," Seiders said. ....... http://www.JoeFRocks.com/Fed housing gold silver
............NEM Takes Out Friday's Cycle Low !
Gadzooks batdude, this is a treacherous market. The buy the dips crowd (permabulls) is getting wrecked big time. NEM's cycle low so far today is 43.17 versus last Friday's 43.58. HUI is seriously testing last Friday's cycle low and the XAU may do so as well. Wave A down of the major correction since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM) lives until proven otherwise.The past thirteen weeks and one day the NEM Lead Indicator is a very bearish -13.80% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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
.......................No Fed Credit Today?
The Fed didn't spike the index fund trader punch today, to put it mildly. Sometimes ahead of Fed meetings (FOMC tomorrow) they don't provide credit, maybe because they're busy? It looks like they'll provide NO credit today, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. So, index fund traders probably won't provide much help to gold/silver stocks today, since Fed Credit has been below average recently, despite the punch spiking that occurred on Thursday and Friday. The S & P 500 (SPX) is the index to watch as it drives index fund trading. ....... http://www.JoeFRocks.com/SPX Fed credit
XAU Implied Volatility And Put/Call Ratio Collapsing
XAU Implied Volatility has fallen from 39.095 on Thursday to 35.46 yesterday and the XAU Put/Call Ratio (October expiration) has collapsed from 1.01745 on Friday to 0.87327 today, which means that Friday's cycle lows for HUI/NEM/XAU may not have been Wave A cycle lows for the major correction since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM). Also, the NEM Lead Indicator has been very bearish the past two days at -1.56% and -0.65% vs the XAU, plus, Fed Credit has been below average recently. So, there's no rush to go long right now. Most of you shouldn't be trading wave B up of a major correction long anyway. But, there are many gold/silver stocks that remain in Cyclical Bull Markets. Any stocks that have completed 18 monthish Cyclical Bear Markets in the past year or two are trading/investing candidates, then you do your due diligence. CDE for example completed a 16 monthish Cyclical Bear Market in mid 2005 if I remember correctly.The past thirteen weeks and one day the NEM Lead Indicator is a very bearish -13.80% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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 Fed credit
The 10-Year Treasury Bond Appears To Be Bottoming
The 10-Year Treasury Bond appears to be putting in a major cycle low after doing a multi month Elliot Wave ABC down up down downcycle (ABC pattern not obvious on the Yahoo chart), see http://finance.yahoo.com/q/bc?s=%5ETNX&t=2y&l=off&z=l&q=c&c=. Therefore, people looking to take out fixed rate mortgages should do so now before long term rates head back up significantly. Adjustable Rate Mortgages (ARMs) are tied to short term interest rates and fixed rate mortgages are tied to long term interest rates........ http://www.JoeFRocks.com/mortgages ARMs
....................Additional Subjects For This Blog
Don't worry, the main topic of this thread will probably be gold/silver stocks for a long time to come because it's such a great market to trade (it's the market I love), but, I'm also probably going to discuss the S & P 500 (SPX, I already discuss this some), T bonds, T Bills, debt, credit, loans, personal finance, ways to save, mortgages, refinancing, the economy, etc. Cycle trendlines, Elliot Wave, and gaps plus various indicators and COT data can be used to time any market. This will be a way to potentially dramatically increase the readership of this blog. I'm going to do some experimenting basically and see what happens. ....... http://www.JoeFRocks.com/debt credit loans mortgages refinancing
The NEM Lead Indicator Was a Very Bearish -1.56% Vs The XAU Today
The NEM Lead Indicator was a very bearish -1.56% versus the XAU today after being a bearish -0.65% versus the XAU on Friday. It looks like wave B up of the major correction since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM) began on Friday, but, given the very bearish NEM Lead Indicator right now and Wednesday's Fed FOMC meeting, there's no rush to go long, and, a test of Friday's potential wave A cycle lows is possible. Buying after a higher cycle low occurs, to make sure that wave B began early on Friday, makes sense.The XAU has done an Elliot Wave 12345 upcycle since early Friday, (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), and, Waves A and B appear to have occurred late today, which means that wave C down and a breakdown of the XAU's uptrending (potentially wave 1 of wave B) channel since early Friday appears likely early tomorrow, and, jives with the very bearish NEM Lead Indicator (was a very bearish -1.56% versus the XAU) today after being -0.65% versus the XAU on Friday.The past thirteen weeks and one day the NEM Lead Indicator is a very bearish -13.80% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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 Fed
The NEM Lead Indicator Is Very Bearish So Far Today
The NEM Lead Indicator is very bearish so far today at -1.00% versus the XAU right now after being -0.65% versus the XAU on Friday. It looks like wave B up of the major correction since 9-6 for HUI/XAU (since 9-5 for reliable lead indicator NEM) began on Friday, but, given the very bearish NEM Lead Indicator right now and Wednesday's Fed FOMC meeting, there's no rush to go long, and, a test of Friday's potential Wave A cycle lows is likely.The past thirteen weeks the NEM Lead Indicator is a very bearish -12.24% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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 Fed
The Fed Didn't Spike The Index Fund Trader Punch Today
The Fed didn't spike the index fund trader punch today. The $2.75 Billion one day Repurchase Agreement or "Repo" as it's called is a small fraction of the daily average for Fed Credit (about $7 Billion), see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. So, index fund traders probably won't provide much help to gold/silver stocks today, since Fed Credit has been below average recently, despite the punch spiking that occurred on Thursday and Friday. The S & P 500 (SPX) is the index to watch as it drives index fund trading. ....... http://www.JoeFRocks.com/Fed SPX
The Typical Early Monday Pop Will Probably Be Followed By A Fizzle
A test of Friday's potential Wave A cycle low for the major correction since 9-6 may occur today or tomorrow. With the Fed FOMC meeting on Wednesday and the hammering that gold/silver stock longs have taken recently, it's difficult to imagine HUI/XAU making much headway prior to the Fed meeting, but, short covering could lead to significant strength. The NEM Lead Indicator was -0.65% versus the XAU on Friday and XAU Implied Volatility points to some weakness today as well, as discussed yesterday.The past thirteen weeks the NEM Lead Indicator is a very bearish -12.24% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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 Fed
The Real Estate Bubble Burst With A Vengence
Much of the economic strength in the US the past few years has been real estate and credit related (mortgage refinancing and credit cards). Interest/mortgage rates fell to rock bottom levels and new types of creative loans/mortgages were added to existing ones. The Fed had an easy money policy (provided a lot of credit/loans to banks) in addition to the rock bottom rates (mortgages and even credit cards if you had good credit and knew what you were doing), which was passed on by lenders to consumers via mortgages and credit cards. Check out the article below and you'll see that the $#it has hit the fan (foreclosures have spiked in a big way): http://money.cnn.com/2006/09/13/real_estate/foreclosures_spiking/. ....... http://www.JoeFRocks.com/Credit Fed foreclosures mortgages
A Significant Rise In Complacency Occurred On Friday For The XAU
XAU Implied Volatility fell -2.58% to 38.085 on Friday 9-15 from 39.095 on 9-14 versus a +0.67% rise in the XAU on 9-15, which is a significant (0.50-1.99%) +1.91% rise in complacency (-2.58% + +0.67% = -1.91%. The XAU wall of worry shrank by -1.91%, therefore complacency rose by +1.91%) that portends weakness/a downtrend during part of Monday 9-18's session (complacency is usually contrarian, therefore normally portends weakness, until it reachs an unusually large level (> 6% increase) where it becomes non contrarian). That weakness/a downtrend could follow a gap up at the open and early strength. XAU Implied Volatility tends to indicate a trend/tone rather than necessarily a simplistic up or down session. The past thirteen weeks the NEM Lead Indicator is a very bearish -12.24% 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 correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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
The 100-110 XAU Cyclical Bear Market Wave A Cycle Low Target Range
This is a repost:
The XAU's very long term upcycle/Secular Bull Market (since October 2000) uptrend line is currently at 80-85ish. See the second chart at http://www.joefrocks.com/GoldStockCharts.html, which is from February of this year. The 100-110 XAU Cyclical Bear Market Wave A cycle low target range is an educated guess based on the obvious assumption that Wave A doesn't bring the XAU down to it's very long term upcycle/Secular Bull Market uptrend line, otherwise the Cyclical Bear Market would be over, and, it won't be Wave A it would be Wave C.The second chart from February shows that the Wave 5 long term upcycle was peaking, and, peaked on 5-11-06, which was a Wave 1 Cyclical Bull Market cycle high for the XAU and HUI (began late 2000). Reliable lead indicator NEM's Wave 1 Cyclical Bull Market cycle high occurred on 1-31-06 (began October 2000). The third chart shows the US Dollar putting in a major cycle low above it's previous one, indicating that the USD is in a Cyclical Bull Market, and, the fourth chart is the NEM Lead Indicator chart that reveals NEM dramatically leading to the downside months before the Wave 1 Cyclical Bull Market cycle highs for HUI/XAU. There shouldn't be much relief for longs until Wave A down of the Wave 2 Cyclical Bear Market (since 5-11-06 for HUI/XAU and since 1-31-06 for reliable lead indicator NEM) bottoms in the 100-110 range (XAU) in the next few weeks. 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 USD
The NEM Lead Indicator Was A Bearish -0.65% Vs The XAU Today
There's a good chance based on the bearish NEM Lead Indicator that Wave A of the major correction since 9-6 for HUI/XAU is still in effect, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=. But, HUI/NEM/XAU are probably close to a Wave A cycle low if one didn't occur today. The NEM Lead Indicator has turned very bullish (short term) since 9-7 (nearly +3.00% versus the XAU), the latest COT (Commitments Of Traders) is very bullish (short term), since the Commercial Traders traded net long in a big way, but, the unusually large (> 10% change) net short trade by the normally contrarian Speculators portends some weakness (when they trade with a lot of conviction they tend to be correct short term, as they were this week), see http://www.cftc.gov/dea/options/deacmxsof.htm, and, the Fed spiked the index fund trader punch in a big way yesterday and today, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. Very high volume is another sign of an imminent cycle low, that was discussed earlier today.The past thirteen weeks the NEM Lead Indicator is a very bearish -12.24% 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 Wednesday 9-6 for HUI/XAU and on Tuesday 9-5 for reliable lead indicator NEM. Wave A of this major correction since 9-6 may still be in effect (may last a few more sessions). Wave B up of the major correction since 9-6 might last over a week, Wave B in the prior major correction 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. ....... http://www.JoeFRocks.com/HUI NEM XAU
Not Convinced That The Major Correction's Wave A Has Bottomed
The fact that NEM is underperforming the XAU (by about -0.30%) right now casts serious doubt on the possibility that NEM/HUI/XAU have entered the major correction's (since 9-5 for reliable lead indicator NEM and since 9-6 for HUI/XAU) wave B short term upcycle. Much of this strength is due to a firm SPX (S & P 500), which has led to automatic computerized index fund buying. Having said this, I think there's a 60-70% chance that wave B has begun, because volume has been very high yesterday and today for NEM, and, probably most gold/silver stocks. Volume tends to spike near important cycle highs/lows. Stay tuned! ....... http://www.JoeFRocks.com/HUI NEM XAU
