SPX (S & P 500), HUI, XAU Cycles And Elliott Wave Count
SPX (S & P 500) probably entered a countertrend Wave B monthly or maybe minor intermediate term upcycle in late November, creating a bullish breakaway gap at 11-28's open at 1428.23, see http://stockcharts.com/charts/gallery.html?%24spx.
A strong short term Wave 1 upcycle occurred, which was a monthly cycle buy signal (2%+ follow through occurred after the intermediate term downcycle trendline was broken), but, since it's a countertrend monthly upcycle, the risk involved with trading SPX long is obviously higher. Those looking to trade SPX long should wait for a short term Wave 2 downcycle before buying.
Today's SPX (S & P 500) spike move was probably a countertrend Wave B type upcycle, of a short term Wave 2 downcycle that began after last Friday's short term Wave 1 cycle high. Note the bearish large spike on Friday's candle, see http://stockcharts.com/charts/gallery.html?%24spx.
Reliable lead indicator Walmart (WMT) might have put in a short term Wave 3 cycle high at 49.12 today, of the minor intermediate term upcycle since early November, see http://stockcharts.com/charts/gallery.html?wmt. Note the Elliott Wave up down up pattern since early November.
The WMT Lead Indicator was -0.05% versus SPX (S & P 500) today/on 12-5, 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 countertrend Wave B monthly or minor intermediate term upcycle should bottom below 10-11-07's likely Cyclical Bull Market cycle high at 1576.09 that occurred +1.30% above July's cycle high at 1555.90.
My strategy is to trade the SPX Ultra ETFs SSO/SDS the next few weeks based upon SPX's Elliott Wave count.
HUI/XAU are probably in a Wave C downcycle, since the four session countertrend Wave B upcycle probably peaked in late November. They 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.
HUI/XAU's charts are very ugly (http://stockcharts.com/charts/gallery.html?%24hui), and, the brief anemic four session countertrend Wave B upcycle is obviously a bearish sign. HUI's short term Wave C downcycle should bottom well below 11-19's Wave A cycle low that occurred at 396.37.
The NEM Lead Indicator was -0.58% versus the XAU on 12-5 and was -0.11% on 12-4.
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
A strong short term Wave 1 upcycle occurred, which was a monthly cycle buy signal (2%+ follow through occurred after the intermediate term downcycle trendline was broken), but, since it's a countertrend monthly upcycle, the risk involved with trading SPX long is obviously higher. Those looking to trade SPX long should wait for a short term Wave 2 downcycle before buying.
Today's SPX (S & P 500) spike move was probably a countertrend Wave B type upcycle, of a short term Wave 2 downcycle that began after last Friday's short term Wave 1 cycle high. Note the bearish large spike on Friday's candle, see http://stockcharts.com/charts/gallery.html?%24spx.
Reliable lead indicator Walmart (WMT) might have put in a short term Wave 3 cycle high at 49.12 today, of the minor intermediate term upcycle since early November, see http://stockcharts.com/charts/gallery.html?wmt. Note the Elliott Wave up down up pattern since early November.
The WMT Lead Indicator was -0.05% versus SPX (S & P 500) today/on 12-5, 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 countertrend Wave B monthly or minor intermediate term upcycle should bottom below 10-11-07's likely Cyclical Bull Market cycle high at 1576.09 that occurred +1.30% above July's cycle high at 1555.90.
My strategy is to trade the SPX Ultra ETFs SSO/SDS the next few weeks based upon SPX's Elliott Wave count.
HUI/XAU are probably in a Wave C downcycle, since the four session countertrend Wave B upcycle probably peaked in late November. They 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.
HUI/XAU's charts are very ugly (http://stockcharts.com/charts/gallery.html?%24hui), and, the brief anemic four session countertrend Wave B upcycle is obviously a bearish sign. HUI's short term Wave C downcycle should bottom well below 11-19's Wave A cycle low that occurred at 396.37.
The NEM Lead Indicator was -0.58% versus the XAU on 12-5 and was -0.11% on 12-4.
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
1:22 PM
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