Very Bearish Gold COT (Commitments Of Traders) Data
The latest gold COT (Commitments Of Traders) Data (5 day period ending 9-11) is very bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders made a huge short trade, adding 53,207 short futures and options contracts, while also taking advantage of gold's recent sharp rally, adding 10,826 long futures and options contracts.
This jives with the extremely bearish NEM Lead Indicator = +0.12% versus the XAU on 9-14, -1.34% 9-13, +0.02% on 9-12, +0.25% on 9-11, -0.69% on 9-10, +0.42% on 9-7, -1.39% on 9-6, +0.06% on 9-5, -1.81% on 9-4, -0.98% on 8-31, -0.03% on 8-30, -1.86% on 8-29 = an extremely bearish -7.23% versus the XAU the past 12 sessions, see six month NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=6m&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
Gold's Wave B of it's Wave 2 Cyclical Bear Market since 5-11-06 surprised to the upside recently, see charts 1 and 2 at http://stockcharts.com/charts/gallery.html?$GOLD, taking out April's cycle high at $698 that appeared to be the Wave B cycle high of the Wave 2 Cyclical Bear Market since 5-11-06 (Wave 1 Cyclical Bull Market cycle high occurred at $730.40 on 5-11-06).
The huge spike move is typical of what happens near very important cycle highs, and, Gold's Wave B of the Wave 2 Cyclical Bear Market since 5-11-06 may have peaked Friday at $726.50 versus the Wave 1 Cyclical Bull Market cycle high that occurred at $730.40 on 5-11-06. The bearish large spike on Friday's candle (http://stockcharts.com/charts/gallery.html?$GOLD) is a sign that it may be an important cycle high. Also, one can see that the peaks are flattening out/rolling over in recent sessions, which is obviously a bearish sign.
Most of the amateur wannabe gold analysts (some were just born into rich families and are pretending to be gold "gurus") have led and continue to lead most people to a financial disaster. There are far too many dingbats pretending to be gold analysts/timers in the gold/silver sector.
Wave A bottomed at $542.27 in June 2006 and the Wave 1 Cyclical Bull Market cycle high occurred at $730.40 on 5-11-06, see http://stockcharts.com/charts/gallery.html?$GOLD. From April 2007 until today gold managed to rise about +4% in five months, which is obviously not a Bull Market uptrend. Only a gold "guru" would think that's a Bull Market.
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 volatile stocks/ETFs 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 $475ish right now, so, gold would be a great buy in the $475-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
This jives with the extremely bearish NEM Lead Indicator = +0.12% versus the XAU on 9-14, -1.34% 9-13, +0.02% on 9-12, +0.25% on 9-11, -0.69% on 9-10, +0.42% on 9-7, -1.39% on 9-6, +0.06% on 9-5, -1.81% on 9-4, -0.98% on 8-31, -0.03% on 8-30, -1.86% on 8-29 = an extremely bearish -7.23% versus the XAU the past 12 sessions, see six month NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=6m&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
Gold's Wave B of it's Wave 2 Cyclical Bear Market since 5-11-06 surprised to the upside recently, see charts 1 and 2 at http://stockcharts.com/charts/gallery.html?$GOLD, taking out April's cycle high at $698 that appeared to be the Wave B cycle high of the Wave 2 Cyclical Bear Market since 5-11-06 (Wave 1 Cyclical Bull Market cycle high occurred at $730.40 on 5-11-06).
The huge spike move is typical of what happens near very important cycle highs, and, Gold's Wave B of the Wave 2 Cyclical Bear Market since 5-11-06 may have peaked Friday at $726.50 versus the Wave 1 Cyclical Bull Market cycle high that occurred at $730.40 on 5-11-06. The bearish large spike on Friday's candle (http://stockcharts.com/charts/gallery.html?$GOLD) is a sign that it may be an important cycle high. Also, one can see that the peaks are flattening out/rolling over in recent sessions, which is obviously a bearish sign.
Most of the amateur wannabe gold analysts (some were just born into rich families and are pretending to be gold "gurus") have led and continue to lead most people to a financial disaster. There are far too many dingbats pretending to be gold analysts/timers in the gold/silver sector.
Wave A bottomed at $542.27 in June 2006 and the Wave 1 Cyclical Bull Market cycle high occurred at $730.40 on 5-11-06, see http://stockcharts.com/charts/gallery.html?$GOLD. From April 2007 until today gold managed to rise about +4% in five months, which is obviously not a Bull Market uptrend. Only a gold "guru" would think that's a Bull Market.
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 volatile stocks/ETFs 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 $475ish right now, so, gold would be a great buy in the $475-500 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
3:16 PM
