WMT May Have Put In A Monthly Cycle Low At 45.73 On Friday
Reliable SPX/market lead indicator WMT may have put in a monthly cycle low at 45.73 on Friday (leading SPX, which appears to have hit a Wave A cycle low today), see http://finance.yahoo.com/q/ta?s=wmt&t=3m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. Today's cycle low was 45.80. WMT will have to do a strong short term Wave 1 upcycle in order to hit a monthly cycle buy signal, which would indicate that WMT has probably/very likely bottomed.
SPX appears to have only hit a short term/Wave A cycle low today, since SPX's recent substantial decline appears to be Wave A down of an intermediate term downcycle, see annotated chart 1 at http://www.joefrocks.com/GoldStockCharts.html.
The WMT Lead Indicator was a bearish -0.44% versus SPX today, and, it became more bearish toward 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 very bearish -1.28% versus the XAU today, and, it became more bearish toward session's end, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Until WMT hits a monthly cycle buy signal, and, since the WMT Lead Indicator was a bearish -0.44% versus SPX today, one should be cautious, so, I'm not going to discuss the trading stocks today.
Also, the S & P 500 (SPX) is probably in a countertrend short term Wave B upcycle of an intermediate term downcycle, see annotated chart 1 at http://www.joefrocks.com/GoldStockCharts.html, with today's strength probably being Wave 1 up of Wave B, 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=.
Once SPX's Wave B peaks in a week or so it'll probably be a good idea to exit long positions. The Elliott Wave count, plus SPX may put in a bearish large spike when Wave B peaks, will be highly useful for timing the short term Wave B upcycle.
In this market especially, even if you're a daredevil, it makes a lot of sense to wait for a strong short term Wave 1 upcycle to trigger a monthly cycle buy signal, then look to buy late in a short term Wave 2 downcycle or early in Wave 3 up. Using cycle trendlines also makes a lot of sense. Usually at least one important trendline (important short term at least) will be broken before one should look to buy.
Often a bullish large inverse spike will occur when a cycle low occurs, which is a sign to look to go long. Conversely, often a bearish large spike will occur when a cycle high occurs, which is a sign to look to exit a long position.
Cycle trendlines/channels used in concert with Elliott Wave patterns and gaps are the basis/crux of "Trade the Cycles." "Gaps action" is very important.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
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/ .
HUI NEM XAU
SPX appears to have only hit a short term/Wave A cycle low today, since SPX's recent substantial decline appears to be Wave A down of an intermediate term downcycle, see annotated chart 1 at http://www.joefrocks.com/GoldStockCharts.html.
The WMT Lead Indicator was a bearish -0.44% versus SPX today, and, it became more bearish toward 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 very bearish -1.28% versus the XAU today, and, it became more bearish toward session's end, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Until WMT hits a monthly cycle buy signal, and, since the WMT Lead Indicator was a bearish -0.44% versus SPX today, one should be cautious, so, I'm not going to discuss the trading stocks today.
Also, the S & P 500 (SPX) is probably in a countertrend short term Wave B upcycle of an intermediate term downcycle, see annotated chart 1 at http://www.joefrocks.com/GoldStockCharts.html, with today's strength probably being Wave 1 up of Wave B, 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=.
Once SPX's Wave B peaks in a week or so it'll probably be a good idea to exit long positions. The Elliott Wave count, plus SPX may put in a bearish large spike when Wave B peaks, will be highly useful for timing the short term Wave B upcycle.
In this market especially, even if you're a daredevil, it makes a lot of sense to wait for a strong short term Wave 1 upcycle to trigger a monthly cycle buy signal, then look to buy late in a short term Wave 2 downcycle or early in Wave 3 up. Using cycle trendlines also makes a lot of sense. Usually at least one important trendline (important short term at least) will be broken before one should look to buy.
Often a bullish large inverse spike will occur when a cycle low occurs, which is a sign to look to go long. Conversely, often a bearish large spike will occur when a cycle high occurs, which is a sign to look to exit a long position.
Cycle trendlines/channels used in concert with Elliott Wave patterns and gaps are the basis/crux of "Trade the Cycles." "Gaps action" is very important.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
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/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:19 PM
