The XAU's Short Term Wave B Of Wave C Appears To Have Peaked
The XAU's short term Wave B of Wave C since 12-18-07 (Wave A intermediate term downcycle since 11-7-07, http://stockcharts.com/charts/gallery.html?%24xau) appears to have peaked, see http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
Today's cycle high at 176.37 is a bearish slightly lower countertrend Wave B double top with Friday's cycle high at 176.42. If the XAU fills the downside gap at 168.95, then the short term Wave B of Wave C since 12-18-07 has very likely peaked, see http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c.
The fact that the XAU couldn't stage a meaningful rally today after the early plunge, despite the very bullish NEM Lead Indicator (+1.38% versus the XAU today/12-31-07), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem, is obviously a bearish sign.
In the next session or two I'll be looking to short HUI/XAU via shorting the Gold Miners ETF GDX.
Once HUI/XAU do a very sharp -3%+ very short term 1-2 day Wave A type downcycle I'l look to short GDX, the Gold Miners ETF, in a countertrend Wave B rebound/very short term 1-2 day upcycle, that obviously must peak below the previous cycle high, otherwise it wouldn't be a countertrend Wave B upcycle. I'll also look for the NEM/WMT Lead Indicators to be bearish or at least near neutral/not overly bullish on an intraday basis (intraday chart, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem).
The NEM Lead Indicator is mostly very bearish recently, at a very bullish +1.38% versus the XAU today/12-31, at a bearish -0.90% versus the XAU on 12-28, was a very bearish -1.15% on 12-27, was a very bearish -1.12% on 12-26, was a very bearish -1.10% on 12-24, was a very bearish -1.08% on 12-21, -0.18% on 12-20, -0.26% on 12-19.
The WMT Lead Indicator was a bearish -0.45% versus SPX (S & P 500) today/on 12-31, was +0.50% versus SPX (S & P 500) on 12-28, was +0.17% versus SPX (S & P 500) on 12-27, was a bearish -0.82% on 12-26, +0.29% on 12-24, -0.92% on 12-21, -0.97% on 12-20, -0.19% on 12-19.
NDX (NASDAQ 100) is doing a very short term Wave A downcycle since 12-26-07, that's the first downcycle of the final Wave C of Wave C of the intermediate term downcycle since late October (http://stockcharts.com/charts/gallery.html?%24ndx), 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. So, I may short NDX (via the Ultra Short NDX ETF QID) during a very short term countertrend Wave B rebound/upcycle in the next session or two.
The beauty of gaps is that, usually/reliably, important cycle highs/lows occur shortly after gap filling action is completed.
NDX's (NASDAQ 100, http://stockcharts.com/charts/gallery.html?%24ndx) Wave A intermediate term cycle low target range of 1820-1840 was very straightforward/easy to derive. NDX's (NASDAQ 100) short term Wave C of Wave C/final intermediate term cycle (Wave A intermediate term downcycle since late October) low target range is 1820-1840 (1980.18 was the Wave A cycle low on 11-12-07, see http://stockcharts.com/charts/gallery.html?%24ndx), shortly after filling the final downside gap at 1846.09.
NDX’s Wave A of Wave C of Wave C should/might bottom at 1940-2020. NDX (NASDAQ 100) has downside gaps at 2111.77 (filled 12-27), 2069.68, 2031.00, 1989.36, 1982.16, 1960.20, 1899.24, 1846.09.
I have more work to do for HUI/XAU/NEM/GDX. I'll try to post that in the next day or two. NEM has downside gaps at 48.45 (filled 12-27/today), 47.39, 42.29, 41.52. So, NEM may fill all of those gaps, but I need to look at all (HUI/XAU/NEM/GDX) and derive good target(s). A few weeks ago, with the big day trade I did, I had to use NEM, because, that was the only available downside gap.
Given the Euro gold's long term bearish double top (May 2006/November 2007, see chart 3 at http://www.the-privateer.com/chart/g-multi.html), and, the fact that the US Dollar probably entered a Cyclical Bull Market in November 2007 after being in a Bear Market since late 2005 (think any of the gold writers will point that fact out?), see http://stockcharts.com/charts/gallery.html?%24usd, plus the very bearish NEM/WMT Lead Indicators recently (see NEM Lead Indicator 5 day chart http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem), and it's far too risky to trade gold aggressively or even modestly long now.
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 (the long term upcycle from June 2006 to 11-7-07 was an anemic rollover upcycle, in which HUI/XAU were underwater until October 2007 versus the 5-11-06 cycle highs), 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
Today's cycle high at 176.37 is a bearish slightly lower countertrend Wave B double top with Friday's cycle high at 176.42. If the XAU fills the downside gap at 168.95, then the short term Wave B of Wave C since 12-18-07 has very likely peaked, see http://finance.yahoo.com/q/ta?s=%5Exau&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c.
The fact that the XAU couldn't stage a meaningful rally today after the early plunge, despite the very bullish NEM Lead Indicator (+1.38% versus the XAU today/12-31-07), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem, is obviously a bearish sign.
In the next session or two I'll be looking to short HUI/XAU via shorting the Gold Miners ETF GDX.
Once HUI/XAU do a very sharp -3%+ very short term 1-2 day Wave A type downcycle I'l look to short GDX, the Gold Miners ETF, in a countertrend Wave B rebound/very short term 1-2 day upcycle, that obviously must peak below the previous cycle high, otherwise it wouldn't be a countertrend Wave B upcycle. I'll also look for the NEM/WMT Lead Indicators to be bearish or at least near neutral/not overly bullish on an intraday basis (intraday chart, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem).
The NEM Lead Indicator is mostly very bearish recently, at a very bullish +1.38% versus the XAU today/12-31, at a bearish -0.90% versus the XAU on 12-28, was a very bearish -1.15% on 12-27, was a very bearish -1.12% on 12-26, was a very bearish -1.10% on 12-24, was a very bearish -1.08% on 12-21, -0.18% on 12-20, -0.26% on 12-19.
The WMT Lead Indicator was a bearish -0.45% versus SPX (S & P 500) today/on 12-31, was +0.50% versus SPX (S & P 500) on 12-28, was +0.17% versus SPX (S & P 500) on 12-27, was a bearish -0.82% on 12-26, +0.29% on 12-24, -0.92% on 12-21, -0.97% on 12-20, -0.19% on 12-19.
NDX (NASDAQ 100) is doing a very short term Wave A downcycle since 12-26-07, that's the first downcycle of the final Wave C of Wave C of the intermediate term downcycle since late October (http://stockcharts.com/charts/gallery.html?%24ndx), 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. So, I may short NDX (via the Ultra Short NDX ETF QID) during a very short term countertrend Wave B rebound/upcycle in the next session or two.
The beauty of gaps is that, usually/reliably, important cycle highs/lows occur shortly after gap filling action is completed.
NDX's (NASDAQ 100, http://stockcharts.com/charts/gallery.html?%24ndx) Wave A intermediate term cycle low target range of 1820-1840 was very straightforward/easy to derive. NDX's (NASDAQ 100) short term Wave C of Wave C/final intermediate term cycle (Wave A intermediate term downcycle since late October) low target range is 1820-1840 (1980.18 was the Wave A cycle low on 11-12-07, see http://stockcharts.com/charts/gallery.html?%24ndx), shortly after filling the final downside gap at 1846.09.
NDX’s Wave A of Wave C of Wave C should/might bottom at 1940-2020. NDX (NASDAQ 100) has downside gaps at 2111.77 (filled 12-27), 2069.68, 2031.00, 1989.36, 1982.16, 1960.20, 1899.24, 1846.09.
I have more work to do for HUI/XAU/NEM/GDX. I'll try to post that in the next day or two. NEM has downside gaps at 48.45 (filled 12-27/today), 47.39, 42.29, 41.52. So, NEM may fill all of those gaps, but I need to look at all (HUI/XAU/NEM/GDX) and derive good target(s). A few weeks ago, with the big day trade I did, I had to use NEM, because, that was the only available downside gap.
Given the Euro gold's long term bearish double top (May 2006/November 2007, see chart 3 at http://www.the-privateer.com/chart/g-multi.html), and, the fact that the US Dollar probably entered a Cyclical Bull Market in November 2007 after being in a Bear Market since late 2005 (think any of the gold writers will point that fact out?), see http://stockcharts.com/charts/gallery.html?%24usd, plus the very bearish NEM/WMT Lead Indicators recently (see NEM Lead Indicator 5 day chart http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem), and it's far too risky to trade gold aggressively or even modestly long now.
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 (the long term upcycle from June 2006 to 11-7-07 was an anemic rollover upcycle, in which HUI/XAU were underwater until October 2007 versus the 5-11-06 cycle highs), 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
1:13 PM
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