..............Inflation Data Spooks The Market
CPI and PPI data kept the market in a funk today, but, NDX (NASDAQ 100, http://stockcharts.com/charts/gallery.html?%24ndx) might have put in a bullish slightly lower double bottom cycle low today with Wednesday's cycle low, see http://finance.yahoo.com/q/ta?s=%5Endx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
The WMT Lead Indicator was -0.08% versus SPX (S & P 500) today/on 12-14. I've been waiting for a sharp very short term 1 to 2 day countertrend Wave B rebound/upcycle, in which I'm looking to short NDX again via the Ultra Short ETF QID.
Despite yesterday's very bullish NEM Lead Indicator, at +1.93% versus the XAU (-0.46% today/12-14), HUI fell -2.26% today (WMT Lead Indicator was only +0.09% versus SPX yesterday though, the NEM Lead Indicator isn't necessarily a day ahead indicator (cycles are the most important factor), and, HUI is in a short term Wave C downcycle), 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 and see http://stockcharts.com/charts/gallery.html?%24hui.
It looks like there might be one more very short term Wave C downcycle before HUI hits a Wave A intermediate term cycle low. So, I might short HUI again next week via shorting GDX. I'll wait for a sharp very short term 1 to 2/maybe 3 day countertrend Wave B rebound/upcycle before (if I decide to) going short.
The gold COT (Commitments Of Traders) data is bearish again in the latest report (5 day period ending 12-11-07), because, the savvy non contrarian gold Commercial Traders traded significantly net short, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm.
Some rockets I'm looking to trade are Spicy Pickle, SPKL.OB (http://stockcharts.com/charts/gallery.html?spkl), Rite Aid, RAD (http://stockcharts.com/charts/gallery.html?rad), and, a few gold/metals penny stocks I'm watching/might trade also are Samex Mining, SMXMF.OB (http://stockcharts.com/charts/gallery.html?smxmf), and Aurelio, AULO (http://stockcharts.com/charts/gallery.html?aulo).
SPKL.OB's intermediate term cycle low target range is 0.75 to 1.00. RAD's monthly cycle low target range is 3.40 to 3.60. SMXMF.OB might have bottomed at 0.50 today, but, given the gold Wave A intermediate term downcycle, waiting for the usual strong short term Wave 1 upcycle/buy signal makes sense. AULO looks like it still needs to do a short term Wave 5 upcycle, so, I'm waiting for it's technical picture to clear up.
Some I may bottom pick (I'll trade very modest positions) and some/maybe all I'll wait for the usual strong short term Wave 1 upcycle/buy signal, then I'll look to go long in a short term Wave 2 downcycle.
Since NDX (NASDAQ 100, http://stockcharts.com/charts/gallery.html?%24ndx) appears to have put in a third/final Wave 5 and therefore monthly cycle high, for the cycle since early November (SPX's began in late November), versus SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24spx) having put in a second/Wave 3 cycle high, I'm going to short NDX via QID instead of shorting SPX via SDS. I'm also looking to short HUI again (http://stockcharts.com/charts/gallery.html?%24hui) via shorting GDX.
SPX (S & P 500) put in a likely Cyclical Bull Market cycle high at 1576.09 on 10-11-07, that occurred +1.30% above July's cycle high at 1555.90.
HUI/XAU put in likely Wave 1 Cyclical Bull Market and intermediate term (cycle began 8-16-07) cycle highs on 11-7-07, see http://stockcharts.com/charts/gallery.html?%24hui.
The monetary inflation due to the real estate/mortgage/credit boom from 2002 until early/mid 2006 (and the stock market Cyclical Bull Market from October 2002 until 10-11-07 for SPX (S & P 500) was another major factor) was the primary factor that drove gold's Wave 1 Cyclical Bull Market from April 2001 until November 7, 2007.
Gold began to flounder after the 5-11-06 cycle high at $730, and, didn't exceed that cycle high until October 2007, due to the monetary inflation created by the Fed in order to fight the mortgage/credit crisis.
The current monetary deflation due to the real estate/mortgage/credit bust and SPX's (S & P 500) Cyclical Bear Market should result in a gold Bear 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.
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 $490ish right now, so, gold would be a great buy in the $490-520 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 basically 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 210-230 for HUI and at 90-95 for the XAU. Those are the targets for where the Wave 2 Cyclical Bear Market will bottom. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
The WMT Lead Indicator was -0.08% versus SPX (S & P 500) today/on 12-14. I've been waiting for a sharp very short term 1 to 2 day countertrend Wave B rebound/upcycle, in which I'm looking to short NDX again via the Ultra Short ETF QID.
Despite yesterday's very bullish NEM Lead Indicator, at +1.93% versus the XAU (-0.46% today/12-14), HUI fell -2.26% today (WMT Lead Indicator was only +0.09% versus SPX yesterday though, the NEM Lead Indicator isn't necessarily a day ahead indicator (cycles are the most important factor), and, HUI is in a short term Wave C downcycle), 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 and see http://stockcharts.com/charts/gallery.html?%24hui.
It looks like there might be one more very short term Wave C downcycle before HUI hits a Wave A intermediate term cycle low. So, I might short HUI again next week via shorting GDX. I'll wait for a sharp very short term 1 to 2/maybe 3 day countertrend Wave B rebound/upcycle before (if I decide to) going short.
The gold COT (Commitments Of Traders) data is bearish again in the latest report (5 day period ending 12-11-07), because, the savvy non contrarian gold Commercial Traders traded significantly net short, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm.
Some rockets I'm looking to trade are Spicy Pickle, SPKL.OB (http://stockcharts.com/charts/gallery.html?spkl), Rite Aid, RAD (http://stockcharts.com/charts/gallery.html?rad), and, a few gold/metals penny stocks I'm watching/might trade also are Samex Mining, SMXMF.OB (http://stockcharts.com/charts/gallery.html?smxmf), and Aurelio, AULO (http://stockcharts.com/charts/gallery.html?aulo).
SPKL.OB's intermediate term cycle low target range is 0.75 to 1.00. RAD's monthly cycle low target range is 3.40 to 3.60. SMXMF.OB might have bottomed at 0.50 today, but, given the gold Wave A intermediate term downcycle, waiting for the usual strong short term Wave 1 upcycle/buy signal makes sense. AULO looks like it still needs to do a short term Wave 5 upcycle, so, I'm waiting for it's technical picture to clear up.
Some I may bottom pick (I'll trade very modest positions) and some/maybe all I'll wait for the usual strong short term Wave 1 upcycle/buy signal, then I'll look to go long in a short term Wave 2 downcycle.
Since NDX (NASDAQ 100, http://stockcharts.com/charts/gallery.html?%24ndx) appears to have put in a third/final Wave 5 and therefore monthly cycle high, for the cycle since early November (SPX's began in late November), versus SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24spx) having put in a second/Wave 3 cycle high, I'm going to short NDX via QID instead of shorting SPX via SDS. I'm also looking to short HUI again (http://stockcharts.com/charts/gallery.html?%24hui) via shorting GDX.
SPX (S & P 500) put in a likely Cyclical Bull Market cycle high at 1576.09 on 10-11-07, that occurred +1.30% above July's cycle high at 1555.90.
HUI/XAU put in likely Wave 1 Cyclical Bull Market and intermediate term (cycle began 8-16-07) cycle highs on 11-7-07, see http://stockcharts.com/charts/gallery.html?%24hui.
The monetary inflation due to the real estate/mortgage/credit boom from 2002 until early/mid 2006 (and the stock market Cyclical Bull Market from October 2002 until 10-11-07 for SPX (S & P 500) was another major factor) was the primary factor that drove gold's Wave 1 Cyclical Bull Market from April 2001 until November 7, 2007.
Gold began to flounder after the 5-11-06 cycle high at $730, and, didn't exceed that cycle high until October 2007, due to the monetary inflation created by the Fed in order to fight the mortgage/credit crisis.
The current monetary deflation due to the real estate/mortgage/credit bust and SPX's (S & P 500) Cyclical Bear Market should result in a gold Bear 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.
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 $490ish right now, so, gold would be a great buy in the $490-520 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 basically 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 210-230 for HUI and at 90-95 for the XAU. Those are the targets for where the Wave 2 Cyclical Bear Market will bottom. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:17 PM
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