The NEM Lead Indicator Turned Bearish Late In The Session
The NEM Lead Indicator turned bearish late in the session today (gap versus the XAU narrowed), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem. So, early weakness is likely tomorrow.
Since NEM hit it's Secular Bull Market primary trendline on 10-4-06 (cycle low at 39.84, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html), while HUI/XAU are in the final Wave C decline of the Cyclical Bear Market since 5-11-06 (see charts 2, 3, 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html), NEM should dramatically outperform HUI/XAU the next few weeks, and, intraday changes in the NEM lead Indicator have become more important in assessing it's indications.
In the second half of today's session the NEM Lead Indicator was (approximately) a bearish -0.50% versus the XAU (narrowed by about -0.50%). The Walmart Lead Indicator was an extremely bearish -1.32% versus SPX (S & P 500) today, so, the lead indicators strongly point to weakness early tomorrow, as does Elliott Wave.
HUI/NEM/XAU all did Elliott Wave 12345 up down up down up patterns in their very short term Wave B up that began late yesterday, 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 1 peaked about a half hour into the session, Wave 3 about 1.5 hours into the session, and, Wave 5 peaked in dramatic rollover mode (NEM wasn't nearly as flat as HUI/XAU) about an hour before session's end, so, I'll be looking to get my shorts on in the first hour of trading tomorrow.
Today's first post is at http://tradethecycles.blogspot.com/2007/01/huinemxau-elliott-wave-count.html.
I neglected to mention in today's first post that NEM created a downside gap at today's open at 43.88 and the XAU did so at 136.10. Those downside gaps should get filled this week.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline, for example NEM's is at 40ish right now, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. Therefore, NEM right now would be a great buy in the 40-42 range. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy. The vast majority of gold writers couldn't time their way out of a paper bag. They tend to be terrible.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Since NEM hit it's Secular Bull Market primary trendline on 10-4-06 (cycle low at 39.84, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html), while HUI/XAU are in the final Wave C decline of the Cyclical Bear Market since 5-11-06 (see charts 2, 3, 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html), NEM should dramatically outperform HUI/XAU the next few weeks, and, intraday changes in the NEM lead Indicator have become more important in assessing it's indications.
In the second half of today's session the NEM Lead Indicator was (approximately) a bearish -0.50% versus the XAU (narrowed by about -0.50%). The Walmart Lead Indicator was an extremely bearish -1.32% versus SPX (S & P 500) today, so, the lead indicators strongly point to weakness early tomorrow, as does Elliott Wave.
HUI/NEM/XAU all did Elliott Wave 12345 up down up down up patterns in their very short term Wave B up that began late yesterday, 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 1 peaked about a half hour into the session, Wave 3 about 1.5 hours into the session, and, Wave 5 peaked in dramatic rollover mode (NEM wasn't nearly as flat as HUI/XAU) about an hour before session's end, so, I'll be looking to get my shorts on in the first hour of trading tomorrow.
Today's first post is at http://tradethecycles.blogspot.com/2007/01/huinemxau-elliott-wave-count.html.
I neglected to mention in today's first post that NEM created a downside gap at today's open at 43.88 and the XAU did so at 136.10. Those downside gaps should get filled this week.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline, for example NEM's is at 40ish right now, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. Therefore, NEM right now would be a great buy in the 40-42 range. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy. The vast majority of gold writers couldn't time their way out of a paper bag. They tend to be terrible.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:11 PM
