AVNR, CEGE, And DNDN Cycles, Elliott Wave Count, And Gaps
AVNR, CEGE, and DNDN will be the main focus for now of the "rocket trading" (hot stocks) discussion. All three recently appear to have entered a Cyclical Bull Market with a vengeance, hitting very strong buy signals due to great price/volume action, and, made huge bullish breakaway gaps to the upside, see their 3 month charts (scroll down to see CEGE and DNDN) at http://finance.yahoo.com/q/ta?s=avnr%2C+cege%2C+dndn&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
AVNR is doing a big Wave 4 short term downcycle after a huge Wave 3 up, and, the final Wave C of the big Wave 4 short term downcycle may have bottomed today at 3.17, see http://finance.yahoo.com/q/ta?s=avnr&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
DNDN (the most notable) probably entered a new Cyclical Bull Market in late March after a 3 year Cyclical Bear Market. It made a huge bullish breakaway gap up from the 5 area on enormous volume, completed an Elliott Wave 12345 up down up down up upcycle, and, is in the midst of Wave C of an Elliott Wave ABC down up down correction/downcycle, see http://finance.yahoo.com/q/ta?s=DNDN&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. In the next few days to a week DNDN should complete the Elliott Wave ABC down up down correction/downcycle and fill downside gaps at 14.65, 14.30, and 12.93, and bottom at 12.50ish.
CEGE is a similar situation (in the final Wave C), it should fill a downside gap at 4.31 in the next few days to a week and bottom at 4ish, with 3.50 probably being a bullish breakaway gap, see http://finance.yahoo.com/q/ta?s=cege&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
There are times when one should wait for strength after hitting a price target (hit a buy signal), such as if there's a well established downtrend line one should wait for it to clearly be broken (might wait for a Wave 1 short term upcycle and buy late in a Wave 2 down or early in a Wave 3 up, in the flat early part of the cycle), and, there are times to consider trying to catch the bottom (when I Watch and the WMT Lead Indicator are clearly bullish and/or a stock bounces at a well established uptrend line, then look to buy a pullback).
I'll be using cycle trendlines/channels, Elliott Wave patterns, gaps, the WMT Lead Indicator, I Watch, etc. to time the rockets. If it works the way I think it will it should be a lot of fun. We'll see.
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.
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 5-6 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
AVNR is doing a big Wave 4 short term downcycle after a huge Wave 3 up, and, the final Wave C of the big Wave 4 short term downcycle may have bottomed today at 3.17, see http://finance.yahoo.com/q/ta?s=avnr&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
DNDN (the most notable) probably entered a new Cyclical Bull Market in late March after a 3 year Cyclical Bear Market. It made a huge bullish breakaway gap up from the 5 area on enormous volume, completed an Elliott Wave 12345 up down up down up upcycle, and, is in the midst of Wave C of an Elliott Wave ABC down up down correction/downcycle, see http://finance.yahoo.com/q/ta?s=DNDN&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. In the next few days to a week DNDN should complete the Elliott Wave ABC down up down correction/downcycle and fill downside gaps at 14.65, 14.30, and 12.93, and bottom at 12.50ish.
CEGE is a similar situation (in the final Wave C), it should fill a downside gap at 4.31 in the next few days to a week and bottom at 4ish, with 3.50 probably being a bullish breakaway gap, see http://finance.yahoo.com/q/ta?s=cege&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
There are times when one should wait for strength after hitting a price target (hit a buy signal), such as if there's a well established downtrend line one should wait for it to clearly be broken (might wait for a Wave 1 short term upcycle and buy late in a Wave 2 down or early in a Wave 3 up, in the flat early part of the cycle), and, there are times to consider trying to catch the bottom (when I Watch and the WMT Lead Indicator are clearly bullish and/or a stock bounces at a well established uptrend line, then look to buy a pullback).
I'll be using cycle trendlines/channels, Elliott Wave patterns, gaps, the WMT Lead Indicator, I Watch, etc. to time the rockets. If it works the way I think it will it should be a lot of fun. We'll see.
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.
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 5-6 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
2:31 PM
