Trade the Cycles

Thursday, May 31, 2007

............Weak Q1 GDP Data Led To Strength

Weak Q1 GDP data (+0.60% growth estimate) led to strength in HUI/NEM/XAU/SPX/WMT today, because, it makes Fed rate cutting much more likely.

The current deflationary real estate/mortgage bust declining interest rate environment is bearish for gold/silver and gold/silver stocks. Gold is a hedge against inflation, which is why gold did well/was in a Wave 1 Cyclical Bull Market from April 2001 until May 11, 2006, coinciding closely with the inflationary real estate/mortgage boom from 2002 through 2005.

A lot of goofy gold writers harp on the weak US economy, real estate bust, subprime lending fiasco, etc. as if that's good for gold. It's pretty basic that gold is a hedge against inflation. It's also basic technical analysis that HUI's primary multi year Secular Bull market trendline is at 200-220ish, see chart 7 at http://www.joefrocks.com/GoldStockCharts.html.

Though the WMT and NEM Lead Indicators were bullish at +0.99% versus SPX for WMT, and, at +0.52% versus the XAU today for NEM, they turned bearish late in the session, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC and http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.

Both WMT (http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=) and NEM (http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==) were in very short term Wave 5 type moves today, that might have peaked late in the session.

AGEN entered a short term Wave 5 (correction from Wave 3) on Friday after putting in a cycle low at 2.65 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen. I might buy some tomorrow.

AVNR's short term Wave 4 finally bottomed at 2.94 yesterday (monthly cycle low at 2.36), see http://stockcharts.com/charts/gallery.html?avnr. AVNR gapped up dramatically today to 3.88 from yesterday's close at 3.22 due to good news (http://finance.yahoo.com/q?s=avnr) on strong volume and closed at 3.46. AVNR's early cycle high today at 4.00 is probably the Wave 1 cycle high of a short term Wave 5. AVNR was in Wave C of a very short term Wave 2 near session's end (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=), and, might have bottomed near session's end.

CEGE's action today (http://stockcharts.com/charts/gallery.html?cege), in which it made a huge bullish breakaway gap at the open from 4.08 to 4.59, indicates that a monthly cycle low occurred at 3.79, and, CEGE is in a short term Wave 3 (will probably do Wave 5 of Wave 3 in the next session or two).

DNDN's Wave 5 of a short term Wave 3 peaked well above Wave 3 of Wave 3's cycle high (at 7.30, monthly cycle low at 4.95) at 13.00 early today, see http://stockcharts.com/charts/gallery.html?dndn. So, DNDN is in a short term Wave 4 down that may have bottomed near sesion's end, because a huge
bullish breakaway gap occurred at today's open, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. I may go long DNDN tomorrow.

FCEL put in a short term Wave 4 cycle low at 6.65 yesterday, versus a Wave 3 cycle high at 7.25 and monthly cycle low at 6.30, see http://stockcharts.com/charts/gallery.html?fcel.

QTWW put in a monthly cycle low at 1.17, and, is in Wave 4 of a short term Wave 3, see http://stockcharts.com/charts/gallery.html?qtww.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Wednesday, May 30, 2007

.......The NEM/WMT Lead Indicators Are Bearish

The WMT Lead Indicator was a bearish -0.42% versus the S & P 500 today. After putting in a bearish prominent spike/very short term cycle high early yesterday, WMT did a sharp Wave A type Elliott Wave ABC down up down decline that bottomed early today, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Then WMT did an anemic Elliott Wave 12345 up down up down up pattern that appears to/may have peaked late today, which jives with the bearish -0.42% versus the S & P 500 today. WMT is probably leading to the downside.

The NEM Lead Indicator was a slightly bullish +0.11% versus the XAU today, but, turned bearish late in the session (the gap narrowed dramatically), see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem. GLD, the gold ETF, had a bearish gap down from 65.07 today, and, didn't make a serious attempt at filling it. GLD is oversold, which is why I didn't short some today.

Rockets showing some life today were AVNR, DNDN, and FCEL.

AGEN entered a short term Wave 3 on Friday after putting in a cycle low at 2.65 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen. I might buy some tomorrow.

AVNR's short term Wave 4 finally bottomed at 2.94 today (monthly cycle low at 2.36), see http://stockcharts.com/charts/gallery.html?avnr. AVNR rose dramatically to 3.32 on strong volume before closing at 3.22.

DNDN is in Wave 5 of a short term Wave 3, in which it should peak well above Wave 3 of Wave 3's cycle high at 7.30 (monthly cycle low at 4.95), see http://stockcharts.com/charts/gallery.html?dndn. I may go long DNDN tomorrow.

FCEL put in a short term Wave 4 cycle low at 6.65 today, versus a Wave 3 cycle high at 7.25 and monthly cycle low at 6.30, see http://stockcharts.com/charts/gallery.html?fcel.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Tuesday, May 29, 2007

...................Slow Post Holiday Action

Let's look at the extremely important Elliott Wave patterns for SPX/WMT/HUI/NEM/XAU:

Key lead index SPX (S & P 500) experienced a sharp Wave A type decline from last Wednesday until late Thursday, that did an Elliott Wave ABC down up down pattern, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Since then SPX is doing an anemic countertrend type Wave B Elliott Wave 12345 up down up down up pattern, with Wave 5 up in effect at session's end today, so, some brief early strength is likely for SPX tomorrow.

Looking at the 5 day charts for WMT/HUI/NEM/XAU, they all look pretty sick, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. It looks like HUI/XAU will fail to do Wave 5 of a countertrend type Wave B Elliott Wave 12345 up down up down up pattern. They should put in higher cycle highs early tomorrow than those that occurred early today in order to complete their Elliott Wave patterns, and, that appears unlikely.

Reliable lead indicators WMT and NEM couldn't stage a meaningful rally today after the early (probably program buying induced) spike moves at the open. So, caution is in order now.

The WMT Lead Indicator was a slightly bearish -0.10% versus SPX today (see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC), but, will probably turn more bearish tomorrow.

The NEM Lead Indicator was a slightly bullish +0.21% versus the XAU today (http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem), but, will probably turn bearish tomorrow. Today's tone was weakness as expected, following the program buying spike at the open, see 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==.

Now for HUI's Elliott Wave count, see HUI's chart at http://stockcharts.com/charts/gallery.html?%24hui. HUI's major intermediate term upcycle that began on 10-4-06 peaked on 4-16-07 at 369.69 (The XAU peaked way back on 12-5-06). Wave A down bottomed at 333.37 on 5-1-07. Wave B peaked at 351.85 on 5-4-07. Wave A of Wave C bottomed at 319.56 on 5-17. Wave B of Wave C peaked at 334.43 on 5-21, so, Wave C of Wave C is in effect for HUI, in which it should bottom well below 319.56.

Now, for some of the rockets action:

AGEN entered a short term Wave 3 on Friday after putting in a cycle low at 2.65 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen. I might buy some tomorrow.

AVNR's short term Wave 4 may have finally bottomed at 2.99 today (monthly cycle low at 2.36), see http://stockcharts.com/charts/gallery.html?avnr.

DNDN is in Wave 5 of a short term Wave 3, in which is should peak well above Wave 3 of Wave 3's cycle high at 7.30 (monthly cycle low at 4.95), see http://stockcharts.com/charts/gallery.html?dndn.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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Saturday, May 26, 2007

Tuesday Might Be A "Doomsday" For Gold/Silver Bugs

Tuesday might be a "doomsday" for gold/silver bugs. First of all the NEM Lead Indicator was a very bearish -1.58% versus the XAU on Friday. The WMT Lead Indicator will probably turn bearish again, because WMT's very short term upcycle since late Wednesday appears to have peaked (or be peaking) (http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=), as discussed previously, and, the WMT Lead Indicator was a neutral +0.01% versus SPX on Friday.

Secondly, XAU Implied Volatility revealed a very sharp (3-6%) +3.88% rise in complacency on Friday that points to potentially severe weakness on Tuesday, because, XAU Implied Volatility fell -4.83% to 26.230 on 5-25 from 27.560 on 5-24 versus a +0.95% rise in the XAU, which is a very sharp +3.88% (3-6%) rise in complacency on Friday (XAU Implied Volatility fell -4.83% + +0.95% rise in the XAU = -3.88% decline in the XAU wall of worry = +3.88% rise in complacency on Friday).

Lastly, the XAU Put/Call Ratio has collapsed to 0.74408 on 5-25 for the June expiration from 1.09845 for the May expiration on 5-17 (the day before May expired), which reveals an extremely low fear/complacent market that points to substantial weakness this week.

Now for HUI's Elliott Wave count, see HUI's chart at http://stockcharts.com/charts/gallery.html?%24hui. HUI's major intermediate term upcycle that began on 10-4-06 peaked on 4-16-07 at 369.69 (The XAU peaked way back on 12-5-06). Wave A down bottomed at 333.37 on 5-1-07. Wave B peaked at 351.85 on 5-4-07. Wave A of Wave C bottomed at 319.56 on 5-17. Wave B of Wave C peaked at 334.43 on 5-21, so, Wave C of Wave C is in effect for HUI, in which it should bottom well below 319.56.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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Friday, May 25, 2007

Modest HUI/NEM/XAU/SPX Strength Occurred, Given Yesterday's Very Bullish NEM/WMT Lead Indicators

Modest short lived HUI/NEM/XAU/SPX strength occurred today, especially given yesterday's very bullish NEM/WMT Lead Indicators (+2.70% versus the XAU for NEM and +1.66% versus the S & P 500 for WMT), see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==, which is a bearish sign.

Early in the session HUI/XAU/SPX completed brief Elliott Wave 12345 up down up down up spikes, then they did an intraday Wave A down and spent most of the remainder of the session in an intraday Wave B up, possibly (XAU probably did) entering Wave C down near session's end.

The NEM Lead Indicator was a very bearish -1.58% versus the XAU today/on 5-25, so, severe weakness is likely on Tuesday for HUI/NEM/XAU. I'll be looking to reshort the gold ETF GLD early on Monday. I probably should have shorted it late today, but, it was in an intraday Wave 5, which is why I was waiting. I also have the June XAU 125 puts (XAVRE) at 0.75.

Now for HUI's Elliott Wave count, see HUI's chart at http://stockcharts.com/charts/gallery.html?%24hui. HUI's major intermediate term upcycle that began on 10-4-06 peaked on 4-16-07 at 369.69 (The XAU peaked way back on 12-5-06). Wave A down bottomed at 333.37 on 5-1-07. Wave B peaked at 351.85 on 5-4-07. Wave A of Wave C bottomed at 319.56 on 5-17. Wave B of Wave C peaked at 334.43 on 5-21, so, Wave C of Wave C is in effect for HUI, in which it should bottom well below 319.56.

The WMT Lead Indicator was a neutral +0.01% versus the S & P 500 today/on 5-25. But, WMT's anemic very short term Elliott Wave 12345 up down up down up upcycle since late Wednesday (http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=) has peaked, or, will peak in rollover mode early on Tuesday. The upcycle has been so anemic that most of it occurred in rollover mode. So, weakness is likely to set in for SPX/WMT early on Tuesday.

I'm looking to trade a short term Wave 5 up long for the oil ETF USO, see http://stockcharts.com/charts/gallery.html?uso. Wave 5 began yesterday at 48.59, but, I'm waiting for the well established (1 week) Wave 4 downtrend line to be broken.

AVNR needs to clearly break it's short term Wave 4 downtrend line (bullish perfect double bottom monthly cycle low at 2.36 on 5-14/5-15) , see http://stockcharts.com/charts/gallery.html?avnr and 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=, before it'll be safe to assume that Wave 4 has bottomed.

I didn't go long DNDN and/or AGEN yet. DNDN probably entered Wave 5 of a short term Wave 3 (monthly cycle low at 4.95) yesterday after hitting a cycle low at 6.49, see http://stockcharts.com/charts/gallery.html?dndn.

AGEN's Wave 4 may still be in effect, since it took out the cycle low at 2.76 from Wednesday, with a cycle low today at 2.65 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen. In the future I'm going to wait for a cycle's downtrend line (see http://finance.yahoo.com/q/ta?s=agen&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==) to be clearly broken before I say that a cycle low has probably occurred.

I might do my first audio Blog/Podcast this weekend.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Thursday, May 24, 2007

HUI/NEM/XAU/SPX Should Rebound Tomorrow,Possibly After Early Weakness

HUI/NEM/XAU/SPX should rebound tomorrow, possibly after early weakness, see http://finance.yahoo.com/q/ta?t=5d&s=%5EGSPC&l=off&z=l&q=c&a=m26-12-9&a=m26-12-9&a=p12&a=m26-12-9&a=p12&a=fs&a=m26-12-9&a=p12&a=fs&a=w14&c=gld%2C+%5Ehui. SPX is in a very short term Wave A down move that began yesterday, and, should bottom early tomorrow if it didn't bottom late today, because, the WMT Lead Indicator was a very bullish +1.66% versus the S & P 500 today/on 5-24, and, Fed Credit rose +$2.252 Billion in the 5 day period ending 5-23-07, see http://www.federalreserve.gov/releases/h41/Current/, and, the Fed added a massive +$18.25 Billion in credit today, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE.

Notice in the chart at the link above that GLD, the gold ETF, and HUI both track the S & P 500 closely due to index fund program trading, which accounts for a massive 70% or so of the dollar volume on the NYSE, which is why major manipulation (even minor) of gold is basically impossible. Program trading, with SPX being the key lead index, is such a huge factor that one must time SPX as well as whatever sector you're timing. Today was a great example of that.

The WMT Lead Indicator was a very bullish +1.66% versus the S & P 500 today/on 5-24. So, a sharp rally is likely to begin tomorrow (possibly after early weakness) for HUI/NEM/XAU/SPX.

The NEM Lead Indicator was a very bullish +2.70% versus the XAU today/on 5-24
.

I'm looking to short the gold ETF GLD in an intraday countertrend Wave B. I'm also looking to trade a short term Wave 5 up long for the oil ETF USO, see http://stockcharts.com/charts/gallery.html?uso. It looks like Wave 5 might have begun today at 48.59, but, I'm not convinced yet. Usually it's best to wait for strength (very short term/intraday Wave 1) and buy a pullback (very short term/intraday Wave 2).

Because of the low volume and flat action today I didn't go long DNDN and/or AGEN, because the action was flat/dead in the water. DNDN probably entered Wave 5 of a short term Wave 3 (monthly cycle low at 4.95) today after hitting a cycle low at 6.49, see http://stockcharts.com/charts/gallery.html?dndn.

AGEN entered a short term Wave 5 yesterday after a Wave 4 cycle low at 2.76 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen.

AVNR probably entered a short term Wave 5 today after a Wave 4 cycle low at 3.22 (monthly cycle low at 2.36) , see http://stockcharts.com/charts/gallery.html?avnr. AVNR surprised modestly to the downside from yesterday's cycle low at 3.25, that probably would have been the Wave 4 cycle low were it not for today's severe market weakness. Given how volatile AVNR is, combined with the severe market weakness, and today's downside surprise was very modest, which suggests that a Wave 4 cycle low did occur at 3.22.

HUI/XAU's Wave 2 Cyclical Bear Market (since 5-11-06) should bottom at 200-220 and 85-90 this year, near the primary multi year trendlines (basic TA) since late 2000, shown in charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html.

Chart 8 is old now since NEM broke down and took out the cycle low at 39.84 from 10-4-06. Since HUI/XAU are more volatile/parabolic than NEM their relatively flat multi year trendlines should hold, BUT, note that I drew HUI's optimistically, at the top of the 200-220 target range.

Most of the gold writers don't even understand basic TA. Gold's primary multi year trendline is at $475ish. Most of the "well known" gold writers have been exposed for the bumbling fools most of them are when it comes to market timing/technical analysis.

Fundamentally, the deflationary real estate/mortgage bust is a major negative for gold, which is a hedge against inflation. Note that HUI/XAU's Wave 1 Cyclical Bull Market from late 2000 until 5-11-06 coincided closely with the inflationary real estate/mortgage boom from 2002 through 2005.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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.............Light Holiday Weekend Volume

Many traders have started the holiday weekend early, which has led to light volume today. I may do my first audio Blog/Podcast this weekend. I don't see any surprises today. Gold has broken below it's channel of the previous four days, see http://stockcharts.com/charts/gallery.html?$gold.

I'm looking to short the gold ETF GLD in an intraday countertrend Wave B. I'm also looking to trade a short term Wave 5 up long for the oil ETF USO, see http://stockcharts.com/charts/gallery.html?uso. It looks like Wave 5 might have begun yesterday, but, I'm not convinced yet. Usually it's best to wait for strength (very short term/intraday Wave 1) and buy a pullback (very short term/intraday Wave 2).

Because of the low volume and flat action today I may not go long DNDN and/or AGEN, because the action is flat/dead in the water. DNDN probably entered Wave 5 of a short term Wave 3 (monthly cycle low at 4.95) today after hitting a cycle low at 6.50, see http://stockcharts.com/charts/gallery.html?dndn.

AGEN entered a short term Wave 5 yesterday after a Wave 4 cycle low at 2.76 (monthly cycle low at 2.25), see http://stockcharts.com/charts/gallery.html?agen.

AVNR entered a short term Wave 5 yesterday after a Wave 4 cycle low at 3.25 (monthly cycle low at 2.36) , see http://stockcharts.com/charts/gallery.html?avnr.

HUI/XAU's Wave 2 Cyclical Bear Market (since 5-11-06) should bottom at 200-220 and 85-90 this year, near the primary multi year trendlines (basic TA) since late 2000, shown in charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. Chart 8 is old now since NEM broke down and took out the cycle low at 39.84 from 10-4-06.

Since HUI/XAU are more volatile/parabolic than NEM their relatively flat multi year trendlines should hold, BUT, note that I drew HUI's optimistically, at the top of the 200-220 target range.

Most of the gold writers don't even understand basic TA. Gold's primary multi year trendline is at $475ish. Most of the "well known" gold writers have been exposed for the bumbling fools most of them are when it comes to market timing/technical analysis.

Fundamentally, the deflationary real estate/mortgage bust is a major negative for gold, which is a hedge against inflation. Note that HUI/XAU's Wave 1 Cyclical Bull Market from late 2000 until 5-11-06 coincided closely with the inflationary real estate/mortgage boom from 2002 through 2005.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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Wednesday, May 23, 2007

The NEM/WMT Lead Indicators Turned Bearish Again Late In The Session

The WMT Lead Indicator was a bearish -0.33% versus the S & P 500 today/on 5-23, and, is very bearish recently, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. So, severe weakness may occur tomorrow for HUI/NEM/XAU/SPX.

The NEM Lead Indicator was a slightly bearish -0.04% versus the XAU today/on 5-23, and, is very bearish recently, see the 5 day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem
.

AVNR entered a short term Wave 5 today after hitting 3.25 (monthly cycle low at 2.36), see http://stockcharts.com/charts/gallery.html?avnr. Note the inverse spike that tends to mark cycle lows, just as spikes tend to occur at cycle highs. Yesterday's Elliott Wave count correctly predicted that AVNR's Wave 4 probably hadn't bottomed yet.

DNDN filled it's downside gap at 6.80 as expected (Yesterday's Elliott Wave count correctly predicted. A monthly cycle low occurred at 4.95), see http://stockcharts.com/charts/gallery.html?dndn.

AGEN (monthly cycle low at 2.25 on 5-15) probably entered a short term Wave 5 today after hitting 2.76, see http://stockcharts.com/charts/gallery.html?agen.

I didn't do anything today, but, will look to go long DNDN and/or AGEN tomorrow, possibly doing a day trade. I'll also be looking to short GLD.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Tuesday, May 22, 2007

DNDN Put In A Wave 5 Of Wave 3 Of A Short Term Wave 3 Just After Today's Open

DNDN put in a Wave 5 of Wave 3 of a short term Wave 3 just after today's open as expected/discussed in yesterday's last post, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Short term Wave 3s have a tendency to be large/long and can last over a week.

DNDN's Wave 1 short term upcycle peaked at 6.65 on 5-14 (monthly upcycle since bottoming at 4.95 on 5-11), then Wave 1 of Wave 3 peaked at 6.57 on Thursday 5-17, after which an Elliott Wave ABC down up down pattern (Wave 2 of Wave 3) completed just before 5-18's close, and, Wave 1 of Wave 3 of a short term Wave 3 peaked just after yesterday's open followed by Wave 3 of Wave 3 peaking a few hours later, and, the final Wave 5 of Wave 3 of a short term Wave 3 peaked just after today's open.

After Wave 3 of a short term Wave 3 peaked just after today's open DNDN's Wave 4 of Wave 3 did an intraday Wave A down followed by a countertrend Wave B, and, in Wave C tomorrow it looks like DNDN will fill today's downside gap at 6.80, after which I might go long.

Yesterday I used Elliott Wave patterns to correctly determine that DNDN would probably take out yesterday's cycle high at 7.24 today, with a cycle high today at 7.30. Today I used Elliott Wave patterns to determine that DNDN will probably fill today's downside gap at 6.80 tomorrow, after which I may go long. Let's see what happens. Once one understands cycles Elliott Wave patterns are a truly great tool.

AGEN's short term Wave 3 peaked just after today's open, after which it experienced a huge % decline so far in Wave 4, see http://finance.yahoo.com/q/ta?s=agen&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Wave 4 may have bottomed at 2.90 late in the session (monthly cycle low at 2.25 on 5-15). Yesterday's huge gap up/bullish breakaway gap on huge volume, plus today's Elliott Wave pattern, suggests that Wave 4 probably bottomed late today.

AVNR's short term Wave 4 since early yesterday probably still needs to do Wave C down tomorrow (perfect double bottom monthly cycle low at 2.36 on Monday 5-14/Tuesday 5-15), see http://finance.yahoo.com/q/ta?s=avnr&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.

CEGE might have hit a monthly cycle low at 3.79 on Friday 5-18, see http://finance.yahoo.com/q/ta?s=cege&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.

Four likely new rockets are ENCY, FCEL, NRMX, and WWAT, see http://finance.yahoo.com/q/ta?s=ency%2Cfcel%2Cnrmx%2Cwwat.ob&t=3m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Yahoo's daily charts are a day behind, so click on the 5 day chart to see today's action.

Now for HUI's Elliott Wave count, see HUI's chart at http://stockcharts.com/charts/gallery.html?%24hui. HUI's major intermediate term upcycle that began on 10-4-06 peaked on 4-16-07 at 369.69 (The XAU peaked way back on 12-5-06). Wave A down bottomed at 333.37 on 5-1-07. Wave B peaked at 351.85 on 5-4-07. Wave A of Wave C bottomed at 319.56 on 5-17. Wave B of Wave C peaked at 334.43 yesterday/5-21, so, Wave C of Wave C is probably in effect for HUI, in which it should bottom well below 319.56.

That Elliott Wave count jives with the very bearish 5 day NEM (http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem) and WMT (http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=on&z=l&q=l&p=&a=p12,fs,w14&c=wmt,%5EGSPC) Lead Indicators.

The WMT Lead Indicator was a slightly bearish -0.11% versus SPX today and the NEM Lead Indicator was a slightly bullish +0.12% versus the XAU today.

I'll be looking to reshort GLD tomorrow in a countertrend Wave B type move. I might go long DNDN and/or AGEN also.

I might do my first audio Blog today or tomorrow.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Monday, May 21, 2007

The NEM/WMT Lead Indicators Remain Bearish

The WMT Lead Indicator was a very bearish -1.53% versus the S & P 500 today/on 5-21, and, was a bearish -1.72% last week, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. So, severe weakness is likely tomorrow for HUI/NEM/XAU/SPX.

The NEM Lead Indicator was a bearish -2.56% versus the XAU last W/E 5-18-07, and, was a bearish -0.52% today/on 5-21, see the 5 day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.

DNDN confirmed the bullish case today by convincingly taking out it's short term Wave 1 cycle high (at 6.65) today, with a cycle high at 7.24, see
http://stockcharts.com/charts/gallery.html?dndn. The cycle high at 6.57 from last Thursday should be Wave 1 of the short term Wave 3, today's/tomorrow's cycle high should be Wave 3 of the short term Wave 3, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. It looks like Wave 5 of Wave 3 of the short term Wave 3 will occur early tomorrow, because, DNDN's Wave 3 of Wave 3 has done an up down up down since beginning just before Friday's close.

So, the third Wave 5 upcycle of the short term Wave 3 (plus Wave 5 of Wave 3 of Wave 3 will probably occur early tomorrow), as well as the Wave 5 short term upcycle (monthly upcycle since bottoming at 4.95 on 5-11), still probably lie ahead for DNDN. Despite the bullish breakaway gap today and the fact that Wave 3 probably hasn't peaked yet, I decided not to go long today due to the very bearish WMT Lead Indicator and the fact that Wave 3 of Wave 3's cycle high might be a brief spike early tomorrow followed by a very sharp decline. There's likely to be a good entry point tomorrow for DNDN anyway. DNDN made a bullish large gap up today to 6.55 from Friday's close at 6.07.

The 3 rockets that look great right now are AGEN, AVNR, and DNDN. AVNR's short term Wave 3 peaked at 3.73 early today versus a Wave 1 cycle high at 3.03 on 5-15 and a perfect double bottom monthly cycle low at 2.36 on Monday 5-14/Tuesday 5-15, and, it's short term Wave 4 might have completed a shallow Elliott Wave ABC down up down pattern, or, it's just Wave A of Wave 4 down, see http://finance.yahoo.com/q/ta?s=avnr&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. CEGE might have hit a monthly cycle low at 3.79 on Friday 5-18.

Also, I didn't reshort GLD, the gold ETF, because I'm waiting for it to clearly break down/do an intraday Wave A, then I'll look to short a countertrend Wave B. It's usually better to wait for the expected action and then short a countertrend Wave B (or buy a Wave 2 down if you're looking to go long). I covered GLD at 65.23 early today versus a short at 65.50 on Friday.

AGEN exploded today on big volume due to positive news, see
http://finance.yahoo.com/q/ta?s=AGEN&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. AGEN probably began a short term Wave 4 downcycle (monthly cycle low at 2.25 on 5-15) late today after hitting a session cycle high at 3.69. Wave 3 did an Elliott Wave 12345 up down up down up pattern, which is why it's probably peaked. Also, it had a huge spike move today obviously. However, it made a huge bullish breakaway gap to the upside today, so, it might surprise to the upside early tomorrow, but, it looks like Wave 3 peaked.

I might do my first audio Blog today or tomorrow.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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DNDN Confirmed The Bullish Case And AGEN Exploded

DNDN confirmed the bullish case today by convincingly taking out it's short term Wave 1 cycle high (at 6.65) today, with a cycle high so far at 7.24, see http://stockcharts.com/charts/gallery.html?dndn. The cycle high at 6.57 from last Thursday should be Wave 1 of the short term Wave 3 and today's cycle high should be Wave 3 of the short term Wave 3, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. So, the third Wave 5 upcycle of the short term Wave 3, as well as the Wave 5 short term upcycle (monthly upcycle since bottoming at 4.95 on 5-11), still probably lie ahead. DNDN made a bullish large gap up today to 6.55 at the open from Friday's close at 6.07. I may go long DNDN today.

AGEN exploded today on big volume due to positive news, see http://finance.yahoo.com/q/ta?s=AGEN&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. AGEN is probably in Wave 4 after hitting a monthly cycle low at 2.25 on 5-15, or, it could still be in a big Wave 3, but, more likely it's in a short term Wave 4 down.

I covered GLD at 65.23 early today versus a short at 65.50 on Friday. I may reshort it before session's end.

The WMT Lead Indicator is very bearish today at -1.00%+ versus the S & P 500 and was a bearish -1.72% last week.

The NEM Lead Indicator was a bearish -2.56% versus the XAU last week and is a modestly bearish -0.32% right now.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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Friday, May 18, 2007

.......The NEM/WMT Lead Indicators Are Bearish

The WMT Lead Indicator was a bearish -0.32% versus the S & P 500 today, and, was a bearish -1.72% this week, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

The NEM Lead Indicator was a bearish -2.56% versus the XAU this W/E 5-18-07, and, was a very bearish -1.01% today/on 5-18, see the 5 day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.

More factors pointing to weakness next week are NEM's failure to fill it's upside gap at 39.64 created at yesterday 5-17's open, hence a bearish breakaway gap occurred, and, the XAU trended down most of the session, and, will probably enter the parabolic/sharply declining part of the very short term downcycle on Monday, see http://finance.yahoo.com/q/ta?s=%5Exau&t=1d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.

Also, the gold Speculators liquidated their long position and shorted with a lot of conviction (greater than 10% changes in both their long and short positions) in the 5 day period ending 5-15-07, which makes them non contrarian on a one week basis, see http://www.cftc.gov/dea/options/deacmxsof.htm, which points to potentially severe weakness in gold next week.

I reshorted the gold ETF GLD at 65.50 today after covering it at 65.48 for a tiny profit (entry point at 65.61 in late March) a few days ago. I also bought some XAU June 125 puts (XAVRE) at 0.75 today.

For the rockets it looks like AVNR will do Wave 5 of the short term Wave 3 (began at 2.50 early on Thursday 5-17) early on Monday, see http://finance.yahoo.com/q/ta?s=AVNR&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c==.

CEGE may have hit a monthly cycle low at 3.79 today, see http://stockcharts.com/charts/gallery.html?cege.

CALVF.OB continued to plumb new lows today in Wave C of it's monthly downcycle, hitting 0.125 today, see http://stockcharts.com/charts/gallery.html?calvf. I'm looking for a monthly cycle low in the 10-14 cent range, as discussed in recent weeks.

I was correctly cautious about day trading DNDN today, see http://stockcharts.com/charts/gallery.html?dndn.

See today's first post at http://tradethecycles.blogspot.com/2007/05/avnr-exploded-to-370-dndn-analysis-and.html.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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AVNR Exploded To 3.70, DNDN Analysis, And A New Rocket

AVNR put in a bullish double bottom monthly cycle low at 2.36 on Monday and Tuesday, closing dramatically higher at 2.83 on Tuesday, +17.92%, on very strong volume of over 7.3 million shares, see http://finance.yahoo.com/q/ta?s=AVNR&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c== and http://stockcharts.com/charts/gallery.html?avnr.

AVNR's short term Wave 1 peaked at 3.03 mid session Tuesday, then it did a short term Wave 2 down to 2.50 early yesterday, and, ended the session in a short term Wave 3 up, exploding to 3.19 at session's end and to 3.70 early today, with big volume coming in during the huge spike move, see http://finance.yahoo.com/q/ta?s=AVNR&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. Waiting for a Wave 4 down usually makes sense, but, AVNR is in such a strong uptrend that it might not make sense in this case.

Now for why I've turned cautious on DNDN until it confirms the bullish case by doing a healthy short term Wave 3. Yesterday's cycle high at 6.57 failed to exceed Wave 1's at 6.65 on Monday, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=, which, combined with the recent huge bearish breakaway gap down from the teens (http://stockcharts.com/charts/gallery.html?dndn), means that 4.95 might not be a monthly cycle low.

DNDN did follow through to the downside for a few days after the huge bearish gap down, but, waiting for DNDN to confirm the bullish case by doing a healthy short term Wave 3 up, in which it peaks well above Wave 1's cycle high at 6.65, makes sense. This is why I didn't day trade it today. Also, I Watch data has been missing in recent days and the WMT Lead Indicator has been very bearish in recent weeks, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

DNDN's short term Wave 2 down bottomed at 5.55 late Tuesday, versus a Wave 1 cycle high at 6.65 on Monday and a monthly cycle low at 4.95 on Friday 5-11, see http://stockcharts.com/charts/gallery.html?dndn. So, DNDN is/should be in a Wave 3 short term upcycle.

JRCC is a new rocket, see http://stockcharts.com/charts/gallery.html?jrcc. JRCC entered a Cyclical Bull Market in January 2007 after a Cyclical Bear Market from September 2005. JRCC is in the process of putting in both a monthly and probably also an important intermediate term cycle high (based on a quick Elliott Wave count), so, it'll probably be a few weeks or more before I look to trade it long.

TMY may have put in a Cyclical Bear Market (since May 2006) cycle low on Wednesday (http://stockcharts.com/charts/gallery.html?tmy), but, it'll have to rise to 3+ (hit a 5% major buy signal) to indicate that a Cyclical Bear Market cycle low probably occurred.

I might start podcasting at TribalShout.com. I'll probably do a weekly Trade the Cycles Podcast if it works well. I'm looking to get into both the audio and video worlds, as so many others have done.

See yesterday's post at http://tradethecycles.blogspot.com/2007/05/nem-and-wmt-may-have-hit-important.html.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .

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Thursday, May 17, 2007

NEM And WMT May Have Hit Important Cycle Lows Today

NEM and WMT may have hit important cycle lows today, which means that the NEM/WMT Lead Indicators may have turned short term bullish. NEM may have put in a Wave 2 Cyclical Bear Market (since 1-31-06) cycle low today at 38.85, or, at least a monthly/minor intermediate term cycle low. WMT is in the process of putting in a monthly cycle low.

The WMT Lead Indicator was a slightly bearish -0.06% versus the S & P 500 today/on 5-17, but, it turned bullish near session's end, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. The NEM Lead Indicator was a bearish -0.58% versus the XAU today/on 5-17, but, it turned bullish toward session's end, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.

Fed Credit fell a sharp -$5.658 Billion in the 5 day period ending 5-16-07, see http://www.federalreserve.gov/releases/h41/Current/. In the 5 day period ending 5-9-07 Fed Credit fell a very sharp -$13.418 Billion. Combined with a very bearish WMT Lead Indicator in recent weeks clearly indicates that caution is in order. The WMT Lead Indicator was -0.06% versus SPX on 5-17, -1.32% on 5-16, -0.33% on 5-15, +0.31% on 5-14, -0.90% on 5-11, +1.02% on 5-10, -0.67% on 5-9, -0.93% on 5-8, +0.44% on 5-7, -0.41% on 5-4, -0.26% on 5-3, -0.75% on 5-2, +0.59% on 5-1, -0.09% on 4-30, -0.73% on 4-27, -0.15% on 4-26, -0.76% on 4-25, -0.46% on 4-24, -1.44% on 4-23,

I looked to buy DNDN yesterday and today, but, never got the pullback I was looking for. Given the crappy market and bearish WMT Lead Indicator yesterday and today I was correctly cautious. Early yesterday I was waiting for a well defined Elliott Wave ABC down up down pattern after the early spike move before buying, but, it never happened (there was one but it looked like Wave A to me) and the stock ran away from me, see http://finance.yahoo.com/q/ta?s=dndn&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. I'll probably wait for Wave 4 down, but, I might day trade it tomorrow if there's early weakness.

DNDN's short term Wave 2 down bottomed at 5.55 late Tuesday, versus a Wave 1 cycle high at 6.65 on Monday and a monthly cycle low at 4.95 on Friday, see http://stockcharts.com/charts/gallery.html?dndn. So, DNDN is in a Wave 3 short term upcycle.

AVNR just put in a bullish double bottom monthly cycle low at 2.36 on Monday and Tuesday, closing dramatically higher at 2.83 on Tuesday, +17.92%, on very strong volume of over 7.3 million shares, see http://finance.yahoo.com/q/ta?s=AVNR&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c== and http://stockcharts.com/charts/gallery.html?avnr. AVNR's short term Wave 1 peaked at 3.03 mid session Tuesday, then it did a short term Wave 2 down to 2.50 early today, and, ended the session in a short term Wave 3 up, exploding to 3.19 at session's end, with big volume coming in during the huge spike move, see http://finance.yahoo.com/q/ta?s=AVNR&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==.

BQI failed to do a healthy monthly Elliott Wave 12345 up down up down up upcycle, since Wave 4 took out Wave 2's cycle low at 3.00, with a cycle low so far at 2.92, see http://stockcharts.com/charts/gallery.html?bqi. It's possible that BQI's latest short term upcycle was a big Wave 1 of a monthly upcycle, but, one should have a healthy skepticism when trading and only trade those with healthy reliable Elliott Wave 12345 up down up down up monthly upcycles.

CALVF.OB is approaching a monthly cycle low/is in Wave C (might have bottomed today at 0.126), and, should bottom in the 10-14 cent range as discussed in recent weeks, see http://stockcharts.com/charts/gallery.html?calvf.

CEGE is approaching a monthly cycle low/is in Wave C (cycle low today at 3.82), see http://stockcharts.com/charts/gallery.html?cege.

LMC (see http://finance.yahoo.com/q/ta?s=lmc&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=) put in a bullish triple bottom at 11.85 today, taking out what appeared to be a monthly cycle low at 11.86 on 5-1 (third cycle low at 11.87 yesterday). I might buy some after it breaks it's downtrend line (see declining peaks at http://stockcharts.com/charts/gallery.html?lmc) and establishes a monthly cycle low. Also, waiting for reliable lead indicator NEM to establish an intermediate term cycle low probably makes sense, since LMC is a mining stock.

TMY's Cyclical Bear Market since May 2006 is trying to bottom, see http://stockcharts.com/charts/gallery.html?tmy. Volume was a strong 2.45 million shares yesterday. I Watch has been bullish the past month, see http://iwp.thomsonfn.com/tfspro/iwatch/cgi-bin/iw_ticker?t=TMY&range=30&mgp=0&i=3&hdate=&x=9&y=11. The high volume/volatility in recent days is a sign that the Cyclical Bear Market since May 2006 is trying to bottom. Extreme conditions tend to occur at/near cycle highs/lows.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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Wednesday, May 16, 2007

The WMT Lead Indicator Was A Very Bearish -1.32% Versus The S & P 500 Today/On 5-16

The WMT Lead Indicator was a very bearish -1.32% versus the S & P 500 today/on 5-16, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. The NEM Lead Indicator was a modestly bearish -0.44% versus the XAU today/on 5-16, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.

Reliable lead indicator NEM broke through primary multi year support in the 40 area (see chart 8 at http://www.joefrocks.com/GoldStockCharts.html) today, with a cycle low at 39.25. This means that NEM is still in a Wave 2 Cyclical Bear Market since 1-31-06, and, that a Wave 3 Cyclical Bull Market obviously didn't begin at 39.84 on 10-4-06. NEM's primary multi year Secular Bull Market trendline will be known once it establishes a Wave 2 Cyclical Bear Market cycle low.

Since NEM's multi year trendline prior to today was largely created during the Wave 1 Cyclical Bull Market from October 2000 until January 31, 2006, it's not that surprising that the multi year trendline based on the Wave 1 Cyclical Bull Market trendline has broken down, and, it makes sense that it broke down.

AVNR just put in a bullish double bottom monthly cycle low at 2.36 on Monday and yesterday, closing dramatically higher at 2.83 yesterday, +17.92%, on very strong volume of over 7.3 million shares, see http://stockcharts.com/charts/gallery.html?avnr.

AVNR's short term Wave 1 peaked at 3.03 mid session yesterday, then it did a short term Wave 2 down to 2.60 today, and, might have ended the session in a short term Wave 3 up.

BQI failed to do a healthy monthly Elliott Wave 12345 up down up down up upcycle, since Wave 4 took out Wave 2's cycle low at 3.00, with a cycle low so far at 2.95, see http://stockcharts.com/charts/gallery.html?bqi.

CALVF.ob is approaching a monthly cycle low/is in Wave C (might have bottomed today at 0.135), and, should bottom in the 10-14 cent range as discussed in recent weeks, see http://stockcharts.com/charts/gallery.html?calvf.

CEGE is approaching a monthly cycle low/is in Wave C (might have bottomed yesterday and today at 3.86), see http://stockcharts.com/charts/gallery.html?cege.

DNDN's short term Wave 2 down bottomed at 5.55 late yesterday as expected, versus a Wave 1 cycle high at 6.65 on Monday and a monthly cycle low at 4.95 on Friday, see http://stockcharts.com/charts/gallery.html?dndn. So DNDN is in a Wave 3 short term upcycle.

LMC's short term Wave 2 didn't bottom at 12.07 yesterday versus the monthly cycle low at 11.86 on 5-1, see http://finance.yahoo.com/q/ta?s=lmc&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. It put in a bullish double bottom at 11.87 today however. I might buy some after it breaks it's Wave 2 downtrend line (see Wave 2 declining peaks at http://stockcharts.com/charts/gallery.html?lmc). Also, waiting for reliable lead indicator NEM to establish an intermediate term cycle low probably makes sense, since LMC is a mining stock.

TMY's Cyclical Bear Market since May 2006 is trying to bottom, see http://stockcharts.com/charts/gallery.html?tmy. Volume was a strong 2.45 million shares today. I Watch has been bullish the past month, see http://iwp.thomsonfn.com/tfspro/iwatch/cgi-bin/iw_ticker?t=TMY&range=30&mgp=0&i=3&hdate=&x=9&y=11. The high volume/volatility in recent days is a sign that the Cyclical Bear Market since May 2006 is trying to bottom. Extreme conditions tend to occur at/near cycle highs/lows.

The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18+ month Cyclical Bear Market in the past year or two), etc.

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).

If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.

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. 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. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .


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