SPX (S & P 500), RUT (Russell 2000), HUI, etc Elliott Wave Count

Since SPX (S & P 500) entered a (likely) countertrend short term Wave B upcycle on 10-24-07 (likely Cyclical Bull Market (began October 2002) and minor intermediate term cycle (began 8-16-07) high at 1576.09 on 10-11-07), see http://stockcharts.com/charts/gallery.html?%24spx, SPX has done an up down up pattern on the daily chart, which would (usually) mean that today's move was Wave 3 of the countertrend short term Wave B upcycle.

However, SPX (S & P 500) has a near perfect double bottom on 10-22-07/10-24-07 (http://stockcharts.com/charts/gallery.html?%24spx), with 10-22-07's cycle low being slightly higher than 10-24-07's cycle low, but, one begins the Elliott Wave count with the cycle low obviously on 10-24-07.

However, given the near perfect SPX double bottom and the fact that RUT (Russell 2000, http://stockcharts.com/charts/gallery.html?%24rut) does have an Elliott Wave 12345 up down up down up pattern since 10-22-07, when it's (likely) countertrend short term Wave B upcycle began, it could be that SPX (S & P 500) is peaking now and is really in the final Wave 5 of the short term Wave B since 10-24-07, not Wave 3, which would be very bearish if SPX couldn't complete the usual Elliott Wave 12345 up down up down up pattern since 10-24-07.

Today's very bearish WMT Lead Indicator, at -1.55% versus SPX today/on 10-31, that became more bearish as the session progressed (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), suggests that SPX might be in Wave 5 of Wave B instead of Wave 3, we'll see.

HUI appears to be in a final/third short term Wave 5 (since 10-22-07) of the minor intermediate term upcycle since 8-16-07. HUI, XAU, and gold are likely to soon return to the Cyclical Bear Market that existed from 5-11-06 to September 2007. This major spike move since 8-16-07 is a liquidity/weak USD spike move due to the credit/mortgage crisis.

Sometimes/occasionally cycles will put in a huge spike (in dramatic rollover mode) long after it looks like they've peaked. That's what's probably happening now, and, it jives with the extremely bearish gold COT (Commitments of Traders) data, the extremely bearish NEM Lead Indicator, SPX (S & P 500) peaking etc etc etc. When everything jives, especially in such a big way, one has to go with what's indicated.

The more important the cycle the longer it takes to peak, and, the more deceptive the Elliott Wave count tends to be, because of Elliott Wave patterns tending to occur within Elliott Wave patterns, but, the situation is very clear cut for SPX (S & P 500), HUI, XAU, gold, etc when the cycles, Elliott Wave count, indicators, etc are considered in concert.

See http://tradethecycles.blogspot.com/2007/10/huixau-might-have-peaked-yesterday.html for all the previous analysis/info, and, a big Halloween BOOYAH! Have fun all.

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

Waitin On The Fed And NEM Is Going Bananas On A Good Earnings Report

The Fed will probably cut the Fed Funds rate by a quarter point/0.25%, see http://biz.yahoo.com/ap/071031/fed_interest_rates.html. I might not do a post market close update today, or, if I do it might be tonight.

Reliable HUI/XAU lead indicator NEM is going bananas on a good earnings report, up as much as +9%ish at one point so far today, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.

But, given how well NEM is doing HUI has been very subdued so far, up only +2.50%ish right now, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=. Since NEM has been up as much as +9%ish the fact that HUI couldn't easily take out Monday's cycle high at 430.79 (and is up only a small fraction of what NEM is) is a major negative, though HUI just did slightly exceed 430.79.

It also might mean that HUI will have a big spike move in the next day or two (typically would happen, but, probably not in this case), but, that seems doubtful, unless the Fed cuts by a half point/0.50%, which is doubtful. I think this is just a very brief huge NEM earnings spike move that will quickly correct, and, will probably turn out to be a negative, with NEM adding to the downside in HUI/XAU the next few sessions.

I'm looking to short GDX, the Gold Miners ETF, which has filled yesterday's upside gap at 49.84, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==. Without NEM's huge spike move today no way would GDX have had a shot at filling 49.84.

The precious metals sector is about to get crushed, and, has probably entered a Wave 2 Cyclical Bear Market, which really began on May 11, 2006, since all the +8-10%ish HUI/XAU upside has come this month/October 2007 as a result of the massive liquidity injection by the Fed due to the mortgage/credit crisis. Big picture however the housing crash/huge bust and a looming stock market multi year Bear Market (probably began on 10-11-07 at 1576.09 for SPX (S & P 500)) will be very deflationary, which is a major negative for gold.

I got on a non Yahoo low traffic message board to give a Trade the Cycles assessment of a recently red hot stock that's probably recently entered a 3-6 month major intermediate term downcycle. The bulls there vehemently attacked me, called me a short (stock's under 5, couldn't short it), a basher (really they bashed me and tried to interfere with my right to free speech), and a spammer (I have no newsletter, but, I like to create some links and get a little more exposure, but, this was a low traffic non Yahoo message board. Spam is technically bulk electronic e mail anyway).

They also tried to discredit my work and Elliott Wave, despite the fact that this stock clearly followed Elliott Wave patterns as most do, and, I outlined them. These people are about to get and have started to get crushed, but, they ironically were biting the hand that fed them. Wouldn't they want to know if the stock was likely to experience a major correction?

I got banned within 1 day of signing up, because I was seen as disruptive, and called a few people names, after they of course first falsely accused me of being a spammer, short seller, a basher, etc.

I've seen this before where a bunch of dingbats tried to censor honest objective market timing/technical analysis on a message board. It might amount to attempted illegal stock price manipulation, and, is anti American attempted censorship.

The gold sector is littered with goofy cockroach gold writers who're nearly always bullish. There are some very odd and slimey ducks in the gold sector.

One good thing about the devastation that's going to soon hit the gold sector is that a lot of puny evil empires will get crushed, and, they already did take a major beating from May 2006 to September 2007. ....... http://www.JoeFRocks.com/ .

HUI NEM XAU

............HUI/XAU Might Have Peaked Yesterday

HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) might have hit a Wave 1 Cyclical Bull Market (since late 2000) and a minor intermediate term (began 8-16-07) cycle high yesterday. Looking at HUI's cycle highs since the cycle high at 402.27 on 9-21-07, they are flattening out/rolling over (http://stockcharts.com/charts/gallery.html?%24hui), which is a sign that HUI is peaking.

Because the NEM Lead Indicator turned bullish/became much less bearish (gap narrowed dramatically, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem) near session's end and the WMT Lead Indicator was a very bullish +1.45% versus the S & P 500 (SPX) today I didn't hold a short GDX (Gold Miners ETF) position overnight.

HUI did a significant intraday Wave A down type move early yesterday, followed by a countertrend Wave B type move the rest of the session, then did a Wave C down type move today that might have bottomed near session's end, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c.

Reliable lead indicator NEM has an upside gap from today's open at 47.67 that I'll be watching tomorrow. NEM hit a session cycle low late today at 46.02, shortly after filling last Friday's downside gap at 46.17, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. Often cycle highs/lows occur shortly after gap filling action is completed.

Tomorrow NEM may try to fill today's upside gap at 47.67, the XAU may try to fill today's upside gap at 185.46, and, GDX may try to fill today's upside gap at 49.84. Assuming that GDX fails to fill today's upside gap at 49.84 I'll be looking to go short GDX tomorrow. Obviously, I'll probably be waiting until after the Fed rate decision at 2:15ish pm EST. A quarter point/0.25% Fed Funds rate cut is likely.

NEM has unfilled downside gaps at 42.29 and 41.52. The XAU has unfilled downside gaps at 177.20 and 169.69. GDX has unfilled downside gaps at 47.45, 46.62, and 45.53.

Much of HUI/XAU's gains on Friday/Monday came during very brief spike moves at the open. Spiking action is obviously peaking action.

The NEM Lead Indicator was a very bearish -1.46% versus the XAU yesterday/10-29 and was a neutral -0.01% today, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem, which is obviously a major negative.

The NEM Lead Indicator = an extremely bearish -18.33% versus the XAU the past 44 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, which is obviously a major negative.

Thursday's massive $31 Billion credit injection by the Fed (http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE) was probably a major factor behind the market's strength in recent days prior to today, due to strong program buying. A year ago $15-20 Billion was a massive credit injection for punch spiking Thursday. In recent months it's been about $30 Billion due to the credit/mortgage crisis.

The only reason that HUI/XAU took out their 5-11-06 cycle highs was probably the huge M2 money supply spike in August due to the mortgage/credit crisis, see http://tradethecycles.blogspot.com/2007/10/huge-spike-in-m2-money-supply-occurred.html.

The NEM Lead Indicator and the gold COT data are extremely bearish. In the next week or so I'll be looking to aggressively short the precious metals sector via GDX, the Gold Miners ETF, that closely tracks HUI, and aggressively short RUT via TWM, the Ultra Short Russell 2000 (RUT) ETF.

The WMT Lead Indicator was a very bullish +1.45% versus SPX today/on 10-30, and, was a bullish +0.46% versus SPX yesterday/on 10-29, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.

SPX (S & P 500) entered a countertrend Wave B upcycle early on Wednesday 10-24-07 (http://stockcharts.com/charts/gallery.html?%24spx) and put in a likely Cyclical Bull Market cycle high at 1576.09 on 10-11-07.

SPX's countertrend Wave B upcycle (and RUT's (Russell 2000), which began on Monday 10-22-07) might peak at about the time of Wednesday 10-31-07's Fed rate decision. There should be an Elliott Wave 12345 up down up down up pattern on the daily chart (http://stockcharts.com/charts/gallery.html?%24spx).

TWM did a big short term Wave 1 upcycle that peaked at 68.69 on Monday 10-22 when RUT's Wave A (probably) bottomed, see http://stockcharts.com/charts/gallery.html?twm. I'll be looking to buy TWM when the short term Wave 2 downcycle bottoms some time in the next few days to a week.

RUT's (Russell 2000) short term countertrend Wave B upcycle should do an Elliott Wave 12345 up down up down up pattern for a few days/weeks. I'll be looking to go short shortly after I think Wave 5 of the short term Wave B has peaked.

Notice that the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) probably peaked in July at 856.48 versus a countertrend Wave B cycle high at 852.06 on 10-11-07, so, RUT is in a substantial Wave C type decline that should bottom well below the Wave A cycle low at 736.00 on 8-16-07. If RUT bottoms at 700ish then it has about 18% to fall from it's countertrend Wave B cycle high at 852.06 on 10-11-07.

The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) is up all of 1.30% from July 2007's cycle high at 1555.90 to 10-11-07's likely Cyclical Bull Market cycle high at 1576.09, thanks to massive Fed credit due to the mortgage/credit crisis. Once the market/SPX breaks down nearly sectors will get whacked. SPX actually broke down a few months ago, hitting a 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, and, the recent strength was rollover action, which was the upcycle/Cyclical Bull Market since October 2002 running out of gas. What was going on in the market was very important peaking action.

The reliable WMT Lead Indicator is extremely bearish, see the six month chart (shows WMT, SPX, HUI relative performance) at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

The point of sell signals is much more to indicate that risk has increased dramatically than it is to be a psychic nailing every cycle high. Double and even triple tops are fairly common, as is rollover action with modestly, and, much less frequently (especially for major 5% sell signals), sometimes substantially higher cycle highs occurring. SPX's (S & P 500) 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, indicated that July's cycle high at 1555.90 was a likely/potential Cyclical Bull Market cycle high, and, more importantly, that trading SPX long was risky, because, a very important cycle trendline had broken down.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders traded significantly net long in the five day period ending 10-23-07, correctly anticipating the recent strength, after having gone massively short the prior six weeks, covering 5567 short gold futures and options contracts (adding 19,360 two weeks ago, added 16,788 three weeks ago, added 1751 four weeks ago, added 27,946 five weeks ago, added over 17,000 six weeks ago, and, added a massive 53,207 seven weeks ago), while adding 9632 (added 5075 two weeks ago, liquidated 192 three weeks ago, liquidated 5492 four weeks ago, liquidated 2977 five weeks ago) long gold futures and options contracts.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 8-9% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = -0.01% versus the XAU today/on 10-30, -1.46% on 10-29, +0.09% on 10-26, -0.72% on 10-25, +0.32% on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -18.33% versus the XAU the past 44 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.

A brief rockets summary (none are recommendations, just timing examples/info):

Because a major market downcycle has begun one has to be very careful about trading rockets right now (should be very careful anyway with rockets), if one trades them at all. Generally it's a good idea to trade with the wind/market at your back. Trading long in the midst of a major or even minor downcycle is risky.

Some new rockets I'm watching are TMY (http://tradethecycles.blogspot.com/2007/10/transmeridian-exploration-inc-tmy.html), Titanium Metals Corp (TIE, strong insider buying), VLNC (strong insider buying), PKTR (insider buying), Linux Gold LNXGF (new Cyclical Bull Market).

Spicy Pickle (SPKL.OB, http://stockcharts.com/charts/gallery.html?spkl) needs to do an Elliott Wave ABC down up down monthly downcycle for about a week before I look to trade it long. I'm excited about trading this one. I probably will trade this one once it does a monthly downcycle.

Lincoln Gold, LGCP.OB (http://stockcharts.com/charts/gallery.html?lgcp) looks good once it does an Elliott Wave ABC down up down monthly downcycle for about a week.

I'm "imminently" looking to/might buy VG (Vonage) for a short term Wave 5 upcycle 1 to 2 week trade (trade a Wave 5 short term upcycle of a monthly upcycle).

I'm looking to trade a tiny ICO (http://stockcharts.com/charts/gallery.html?ico) position once it does Elliott Wave ABC down up down monthly downcycle.

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

Trade the Cycles Example - Pediment Exploration Ltd. (CDNX:PEZ.V)

Pediment Exploration Ltd. (CDNX:PEZ.V - News), see http://stockcharts.com/charts/gallery.html?pez.v, has drawn some buzz, because, it's risen a spectacular +800%ish since late last year. Some folks are basically saying consider buying after a short term correction (what I would call a monthly downcycle or maybe a minor intermediate term downcycle).

Let's take a look at PEZ.V's cycles and Elliott Wave count (Trade the Cycles assessment), see chart two at http://stockcharts.com/charts/gallery.html?pez.v. From May 2006 to November 2006 PEZ.V did a Wave 2 major intermediate term downcycle, from the Wave 1 major intermediate term cycle high at 1.18 in May 2006 to the Wave 2 major intermediate term cycle low at 0.405 in November 2006, with a Wave A cycle low at 0.43 and a countertrend Wave B cycle high at 0.63 along the way. The price points are all labeled.

Since putting in a Wave 2 major intermediate term cycle low at 0.405 in November 2006 PEZ.V has done a Wave 3 Elliott Wave 12345 up down up down up major intermediate term upcycle, with Wave 1 up peaking at 1.10, Wave 2 down bottoming at 0.74, Wave 3 up peaking at 2.15, Wave 4 down bottoming at 1.38, and, with the third/final Wave 5 upcycle probably peaking at 3.40 on Thursday 10-25-07, see chart two at http://stockcharts.com/charts/gallery.html?pez.v. Note the bearish very large spike on Thursday 10-25-07's candle.

So, PEZ.V may (on Thursday) have or soon should enter a Wave 4 major intermediate term downcycle that should last about 3 to 6 months, and, will probably result in a similar 66%ish decline that occurred in the Wave 2 major intermediate term downcycle last year (1.18 to 0.405), which would result in a decline to 1.16ish, a reasonable target for the Wave 4 major intermediate term cycle low.

So, the guys that are saying that they're looking to buy a short term correction are very likely to be barking up the wrong tree, especially given that HUI/XAU/gold are likely to soon enter a Wave 2 Cyclical Bear Market. Got cycles?

....... http://www.JoeFRocks.com/ .

............HUI/XAU Might Have Peaked Today

HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) might have hit a Wave 1 Cyclical Bull Market (since late 2000) and a minor intermediate term (began 8-16-07) cycle high today. Looking at HUI's cycle highs since the cycle high at 402.27 on 9-21-07, they are flattening out/rolling over (http://stockcharts.com/charts/gallery.html?%24hui), which is a sign that HUI is peaking.

HUI did a significant intraday Wave A type move early today followed by a likely countertrend Wave B type move the rest of the session, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c. HUI spiked briefly at the open then plunged (likely intraday Wave A type move), which is obviously bearish action.

Much of HUI/XAU's gains on Friday/today came during very brief spike moves at the open. Spiking action is obviously peaking action.

The NEM Lead Indicator was a very bearish -1.46% versus the XAU today/10-29, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem, which is obviously a major negative.

The NEM Lead Indicator = an extremely bearish -18.32% versus the XAU the past 43 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, which is obviously a major negative.

Thursday's massive $31 Billion credit injection by the Fed (http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE) was probably a major factor behind the market's strength in recent days, due to strong program buying. A year ago $15-20 Billion was a massive credit injection for punch spiking Thursday. In recent months it's been about $30 Billion due to the credit/mortgage crisis.

The only reason that HUI/XAU took out their 5-11-06 cycle highs was probably the huge M2 money supply spike in August due to the mortgage/credit crisis, see http://tradethecycles.blogspot.com/2007/10/huge-spike-in-m2-money-supply-occurred.html.

The NEM Lead Indicator and the gold COT data are extremely bearish. I don't see today's action changing anything regarding either the precious metals sector or the major averages. In the next week or so I'll be looking to aggressively short the precious metals sector via GDX, the Gold Miners ETF, that closely tracks HUI, and aggressively short RUT via TWM, the Ultra Short Russell 2000 (RUT) ETF.

The WMT Lead Indicator was a bullish +0.46% versus SPX today/on 10-29, but, it looks like it'll turn negative tomorrow, because, WMT looks like it'll plunge early tomorrow, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.

SPX (S & P 500) entered a countertrend Wave B upcycle early on Wednesday 10-24-07 (http://stockcharts.com/charts/gallery.html?%24spx) and put in a likely Cyclical Bull Market cycle high at 1576.09 on 10-11-07.

SPX's countertrend Wave B upcycle (and RUT's (Russell 2000), which began on Monday 10-22-07) might peak at about the time of this Wednesday 10-31-07's Fed rate decision. There should be an Elliott Wave 12345 up down up down up pattern on the daily chart (http://stockcharts.com/charts/gallery.html?%24spx).

TWM did a big short term Wave 1 upcycle that peaked at 68.69 on Monday 10-22 when RUT's Wave A (probably) bottomed, see http://stockcharts.com/charts/gallery.html?twm. I'll be looking to buy TWM when the short term Wave 2 downcycle bottoms some time in the next few days to a week. RUT's (Russell 2000) short term countertrend Wave B upcycle should do an Elliott Wave 12345 up down up down up pattern for a few days/weeks. I'll be looking to go short shortly after I think Wave 5 of the short term Wave B has peaked.

Notice that the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) probably peaked in July at 856.48 versus a countertrend Wave B cycle high at 852.06 on 10-11-07, so, RUT is in a substantial Wave C type decline that should bottom well below the Wave A cycle low at 736.00 on 8-16-07. If RUT bottoms at 700ish then it has about 18% to fall from it's countertrend Wave B cycle high at 852.06 on 10-11-07.

The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) is up all of 1.30% from July 2007's cycle high at 1555.90 to 10-11-07's likely Cyclical Bull Market cycle high at 1576.09, thanks to massive Fed credit due to the mortgage/credit crisis. Once the market/SPX breaks down nearly sectors will get whacked. SPX actually broke down a few months ago, hitting a 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, and, the recent strength was rollover action, which was the upcycle/Cyclical Bull Market since October 2002 running out of gas. What was going on in the market was very important peaking action.

The reliable WMT Lead Indicator is extremely bearish, see the six month chart (shows WMT, SPX, HUI relative performance) at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

The point of sell signals is much more to indicate that risk has increased dramatically than it is to be a psychic nailing every cycle high. Double and even triple tops are fairly common, as is rollover action with modestly, and, much less frequently (especially for major 5% sell signals), sometimes substantially higher cycle highs occurring. SPX's (S & P 500) 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, indicated that July's cycle high at 1555.90 was a likely/potential Cyclical Bull Market cycle high, and, more importantly, that trading SPX long was risky, because, a very important cycle trendline had broken down.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders traded significantly net long in the five day period ending 10-23-07, correctly anticipating the recent strength, after having gone massively short the prior six weeks, covering 5567 short gold futures and options contracts (adding 19,360 two weeks ago, added 16,788 three weeks ago, added 1751 four weeks ago, added 27,946 five weeks ago, added over 17,000 six weeks ago, and, added a massive 53,207 seven weeks ago), while adding 9632 (added 5075 two weeks ago, liquidated 192 three weeks ago, liquidated 5492 four weeks ago, liquidated 2977 five weeks ago) long gold futures and options contracts.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 8-9% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = -1.46% versus the XAU today/on 10-29, +0.09% on 10-26, -0.72% on 10-25, +0.32% on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -18.32% versus the XAU the past 43 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.

A brief rockets summary (none are recommendations, just timing examples/info):

Because a major market downcycle has begun one has to be very careful about trading rockets right now (should be very careful anyway with rockets), if one trades them at all. Generally it's a good idea to trade with the wind/market at your back. Trading long in the midst of a major or even minor downcycle is risky.

Some new rockets I'm watching are TMY (http://tradethecycles.blogspot.com/2007/10/transmeridian-exploration-inc-tmy.html), Titanium Metals Corp (TIE, strong insider buying), VLNC (strong insider buying), PKTR (insider buying), Linux Gold LNXGF (new Cyclical Bull Market).

Spicy Pickle (SPKL.OB, http://stockcharts.com/charts/gallery.html?spkl) needs to do an Elliott Wave ABC down up down monthly downcycle for about a week before I look to trade it long. I'm excited about trading this one. I probably will trade this one once it does a monthly downcycle.

Lincoln Gold, LGCP.OB (http://stockcharts.com/charts/gallery.html?lgcp) looks good once it does an Elliott Wave ABC down up down monthly downcycle for about a week.

I'm "imminently" looking to/might buy VG (Vonage) for a short term Wave 5 upcycle 1 to 2 week trade (trade a Wave 5 short term upcycle of a monthly upcycle).

I'm looking to trade a tiny ICO (http://stockcharts.com/charts/gallery.html?ico) position once it does Elliott Wave ABC down up down monthly downcycle.

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

.................Two Articles Worth Reading

Two articles worth reading, see http://www.nytimes.com/2007/10/28/business/yourmoney/28mark.html, "A Half, a Quarter or None?," and http://www.nytimes.com/2007/10/28/business/28maker.html, "Beware of the Housing Fallout."

Gold does well in rising interest rate inflationary economic upcycles, such as during the real estate/mortgage/ credit boom from 2002-2006, gold averaged +30 to +35%/year from April 2001 to 5-11-06. Since 5-11-06 gold is doing about +5%/year (but, all of the upside versus 5-11-06's cycle high at $730.40 came in October 2007 due to massive liquidity provided by the Fed due to the mortgage/credit crisis and the half point Fed Funds rate cut that led to a weak US Dollar/firm gold) and should soon turn very negative the next year and enter (might this week) a Wave 2 Cyclical Bear Market. Gold's "rise" (really August 16 to October 2007 liquidity spike) from 5-11-06 to now has been/turned out to be rollover action.

The deflationary real estate/mortgage/credit bust that began in 2006 is a major negative for gold. Ignore the goofballs that say otherwise. Notice that, despite the huge spike move since 8-16-07 (http://stockcharts.com/charts/gallery.html?%24hui) due to the huge liquidity injection by the Fed in response to the mortgage/credit crisis, very few gold writers are even short term cautious, which shows just how incredibly goofy they are.

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 (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 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

.......The Usual Garbage From The Gold Nitwits

Many gold writers are spewing the same type of garbage that they usually do. They don't understand basic technical analysis (HUI/XAU are about 50% above their primary Secular Bull Market trendlines, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html) or the gold COT (Commitments Of Traders) data (shown later, the traders who know what they're doing have gone massively short, while also correctly trading long in recent weeks), let alone cycles (HUI/XAU are up only about 5% from 5-11-06 to 10-26-07, which is the Wave 1 Cyclical Bull Market since late 2000 peaking in dramatic rollover mode).

One would think HUI/XAU were up 50% since 5-11-06 from reading many of the musings (more like amusings) of the gold writers. The money market has smoked HUI/XAU since 5-11-06 and has kept pace with gold. On a risk adjusted basis forgetaboutit!

From a long term investors point of view the only time a market or stock is timely is near it's primary trendline. The laws of Physics haven't been repealed. Basic technical analysis. A lot of fortunes will be destroyed in the next few weeks/months.

Look for HUI to hit 200-220 and the XAU to hit 85-90 in the next year or so, where their primary Secular Bull Market trendlines since late 2000 are (see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html), got cycles?

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders traded significantly net long in the five day period ending 10-23-07, correctly anticipating the recent strength, after having gone massively short the prior six weeks, covering 5567 short gold futures and options contracts (adding 19,360 two weeks ago, added 16,788 three weeks ago, added 1751 four weeks ago, added 27,946 five weeks ago, added over 17,000 six weeks ago, and, added a massive 53,207 seven weeks ago), while adding 9632 (added 5075 two weeks ago, liquidated 192 three weeks ago, liquidated 5492 four weeks ago, liquidated 2977 five weeks ago) long gold futures and options contracts.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 5% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking (HUI probably did on 10-11-07, XAU on Friday 10-26-07) in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = +0.09% versus the XAU on 10-26, -0.72% on 10-25, +0.32% on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -16.86% versus the XAU the past 42 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.

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 (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 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 (S & P 500) Did A Wave 5 Upcycle For The Upcycle Since Early Wednesday

SPX (S & P 500) did a Wave 5 up move just after today's open, for the upcycle since early Wednesday (Wave B began), 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=, then SPX made higher highs late in the session, which was probably Wave 5 rollover action.

Yesterday's massive $31 Billion credit injection by the Fed (http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE) was probably a major factor behind the market's strength today, due to strong program buying. A year ago $15-20 Billion was a massive credit injection for punch spiking Thursday. In recent months it's been about $30 Billion due to the credit/mortgage crisis.

SPX (S & P 500) entered a countertrend Wave B upcycle early on Wednesday 10-24-07 (http://stockcharts.com/charts/gallery.html?%24spx) and put in a likely Cyclical Bull Market cycle high at 1576.09 on 10-11-07.

SPX's countertrend Wave B upcycle (and RUT's (Russell 2000), which began on Monday 10-22-07) might peak at about the time of next Wednesday 10-31-07's Fed rate decision. There should be an Elliott Wave 12345 up down up down up pattern on the daily chart (http://stockcharts.com/charts/gallery.html?%24spx).

HUI's likely Cyclical Bull Market cycle high at 423.16 on 10-11-07 held today (http://stockcharts.com/charts/gallery.html?%24hui), with a cycle high at 421.71, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, and, HUI might have peaked near session's end (it was rolling over), which would probably be a countertrend Wave B cycle high at 421.71, for the cycle since early Monday 10-22.

The XAU managed to barely exceed it's cycle high at 182.82 on 10-15-07 today (http://stockcharts.com/charts/gallery.html?%24xau), with a cycle high at 182.96, a whopping +0.077% above the cycle high on 10-15-07. If the XAU peaked today it's a bearish nearly perfect triple top (on 10-11, 15, 26), that's basically the same as a Wave B cycle high. The XAU is dominated more by a few large cap components than HUI is, and, was probably a bit more influenced by program buying.

The only reason that HUI/XAU took out their 5-11-06 cycle highs was probably the huge M2 money supply spike in August due to the mortgage/credit crisis, see http://tradethecycles.blogspot.com/2007/10/huge-spike-in-m2-money-supply-occurred.html.

The NEM Lead Indicator and the gold COT data are extremely bearish. I don't see today's action changing anything regarding either the precious metals sector or the major averages. In the next week or two I'll be looking to aggressively short the precious metals sector via GDX, the Gold Miners ETF, that closely tracks HUI, and via TWM, the Ultra Short Russell 2000 (RUT) ETF.

The WMT Lead Indicator was a bullish +0.35% versus SPX today/on 10-26. The NEM Lead Indicator was a slightly bullish +0.09% versus the XAU today/on 10-26.

What follows is previous analysis/info, except for the updated gold COT data and the NEM Lead Indicator data.

Since Thursday 10-11-07's likely very important Cyclical Bull Market (and minor intermediate term since 8-16-07) cycle high for SPX (S & P 500) (and HUI), SPX has done a short term Wave A downcycle (did Elliott Wave ABC down up down pattern), that bottomed Wednesday 10-24, 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=.

When SPX (S & P 500), HUI, RUT do/complete a short term countertrend Wave B upcycle for few days/weeks I'm probably going to aggressively (large positions) short GDX, the Gold Miners ETF (tracks HUI), and short the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) via the Ultra Short ETF TWM.

TWM did a big short term Wave 1 upcycle that peaked at 68.69 on Monday 10-22 when RUT's Wave A (probably) bottomed, see http://stockcharts.com/charts/gallery.html?twm. I'll be looking to buy TWM when the short term Wave 2 downcycle bottoms some time in the next few days to a week.

RUT's (Russell 2000) short term countertrend Wave B upcycle should do an Elliott Wave 12345 up down up down up pattern for a few days/weeks. I'll be looking to go short shortly after I think Wave 5 of the short term Wave B has peaked.

Notice that the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) probably peaked in July at 856.48 versus a countertrend Wave B cycle high at 852.06 on 10-11-07, so, RUT is in a substantial Wave C type decline that should bottom well below the Wave A cycle low at 736.00 on 8-16-07. If RUT bottoms at 700ish then it has about 18% to fall from it's countertrend Wave B cycle high at 852.06 on 10-11-07.

The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) is up all of 1.30% from July 2007's cycle high at 1555.90 to 10-11-07's likely Cyclical Bull Market cycle high at 1576.09, thanks to massive Fed credit due to the mortgage/credit crisis. Once the market/SPX breaks down nearly sectors will get whacked. SPX actually broke down a few months ago, hitting a 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, and, the recent strength was rollover action, which was the upcycle/Cyclical Bull Market since October 2002 running out of gas. What was going on in the market was very important peaking action.

The reliable WMT Lead Indicator is extremely bearish, see the six month chart (shows WMT, SPX, HUI relative performance) at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

The point of sell signals is much more to indicate that risk has increased dramatically than it is to be a psychic nailing every cycle high. Double and even triple tops are fairly common, as is rollover action with modestly, and, much less frequently (especially for major 5% sell signals), sometimes substantially higher cycle highs occurring. SPX's (S & P 500) 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, indicated that July's cycle high at 1555.90 was a likely/potential Cyclical Bull Market cycle high, and, more importantly, that trading SPX long was risky, because, a very important cycle trendline had broken down.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders traded significantly net long in the five day period ending 10-23-07, correctly anticipating the recent strength, after having gone massively short the prior six weeks, covering 5567 short gold futures and options contracts (adding 19,360 two weeks ago, added 16,788 three weeks ago, added 1751 four weeks ago, added 27,946 five weeks ago, added over 17,000 six weeks ago, and, added a massive 53,207 seven weeks ago), while adding 9632 (added 5075 two weeks ago, liquidated 192 three weeks ago, liquidated 5492 four weeks ago, liquidated 2977 five weeks ago) long gold futures and options contracts.

HUI/XAU put in bearish triple top cycle highs on Friday 10-26-07 with Monday 10-15-07 and Thursday 10-11-07's cycle highs, see http://stockcharts.com/charts/gallery.html?%24hui, which is probably the Cyclical Bull Market since late 2000 peaking in dramatic rollover mode versus 5-11-06's cycle highs.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 5% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking (HUI probably did on 10-11-07, XAU on Monday 10-15-07) in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = +0.09% versus the XAU today/on 10-26, -0.72% on 10-25, +0.32% on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -16.86% versus the XAU the past 42 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 has been lagging HUI/XAU as it tends to do. Gold was still rising after HUI/XAU peaked (http://stockcharts.com/charts/gallery.html?%24gold). HUI probably/very likely peaked on 10-11-07 and the XAU probably/very likely peaked on 10-15-07.

A brief rockets summary (none are recommendations, just timing examples/info):

Because a major market downcycle has begun one has to be very careful about trading rockets right now (should be very careful anyway with rockets), if one trades them at all. Generally it's a good idea to trade with the wind/market at your back. Trading long in the midst of a major or even minor downcycle is risky.

Some new rockets I'm watching are TMY (http://tradethecycles.blogspot.com/2007/10/transmeridian-exploration-inc-tmy.html), Titanium Metals Corp (TIE, strong insider buying), VLNC (strong insider buying), PKTR (insider buying), Linux Gold LNXGF (new Cyclical Bull Market).

Spicy Pickle (SPKL.OB, http://stockcharts.com/charts/gallery.html?spkl) needs to do an Elliott Wave ABC down up down monthly downcycle for about a week before I look to trade it long. I'm excited about trading this one. I probably will trade this one once it does a monthly downcycle.

Lincoln Gold, LGCP.OB (http://stockcharts.com/charts/gallery.html?lgcp) looks good once it does an Elliott Wave ABC down up down monthly downcycle for about a week.

I'm "imminently" looking to/might buy VG (Vonage) for a short term Wave 5 upcycle 1 to 2 week trade (trade a Wave 5 short term upcycle of a monthly upcycle).

I'm looking to trade a tiny ICO (http://stockcharts.com/charts/gallery.html?ico) position once it does Elliott Wave ABC down up down monthly downcycle.

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

SPX (S & P 500) & RUT (Russell 2000) Are Doing An Elliott Wave 12345 Up Down Up down Up Upcycle Since Early Yesterday

SPX (S & P 500) and RUT (Russell 2000) are doing/trying to do an Elliott Wave 12345 up down up down up upcycle since early yesterday, that's probably the start of a short term countertrend Wave B upcycle for SPX, 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=. They "need" to complete Wave 5 early tomorrow. If they don't that will be a bearish sign obviously.

Since Thursday 10-11-07's likely very important Cyclical Bull Market (and minor intermediate term since 8-16-07) cycle high for SPX (S & P 500) (and HUI), SPX has done a short term Wave A downcycle (did Elliott Wave ABC down up down pattern), that probably bottomed yesterday, 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=.

When SPX (S & P 500), HUI, RUT do/complete a short term countertrend Wave B upcycle for few days/weeks I'm probably going to aggressively (large positions) short GDX, the Gold Miners ETF (tracks HUI), and short the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) via the Ultra Short ETF TWM.

See http://tradethecycles.blogspot.com/2007/10/s-p-500-spx-short-term-wave-downcycle.html if you haven't been reading this Blog or want to refer to the previous analysis/info. Today's WMT Lead Indicator was a slightly bullish +0.12% versus SPX (S & P 500).

HUI (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=), XAU, and reliable lead indicator NEM appear to have completed an Elliott Wave 12345 up down up down up upcycle since early Monday, which might be the entire HUI/XAU short term countertrend Wave B upcycle, since putting in likely Cyclical Bull Market (began late 2000) and minor intermediate term (began 8-16-07) cycle highs on 10-11-07 for HUI (http://stockcharts.com/charts/gallery.html?%24hui) and on 10-15-07 for the XAU.

The bearish NEM Lead Indicator the past 3 days at
-0.72% versus the XAU on 10-25, +0.32% on 10-24, and -1.33% on 10-23 suggests that HUI/XAU's short term countertrend Wave B upcycle since early Monday (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=) might have peaked early today/10-25-07. If so HUI/XAU should do a significant Wave A type decline tomorrow and the NEM Lead Indicator should be bearish when the subsequent countertrend Wave B type rebound occurs. I'll be looking to short the Gold Miners ETF GDX if the short term countertrend Wave B upcycle appears to have peaked.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = -0.72% versus the XAU today/on 10-25, +0.32% on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -16.95% versus the XAU the past 41 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.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders continue to go massively short in the five day period ending 10-16-07, adding a large 19,360 short gold futures and options contracts (added 16,788 two weeks ago, added 1751 three weeks ago, added 27,946 four weeks ago, added over 17,000 five weeks ago, and, added a massive 53,207 six weeks ago), while adding 5075 (liquidated 192 two weeks ago, liquidated 5492 three weeks ago, liquidated 2977 four weeks ago) long gold futures and options contracts, correctly anticipating the recent strength.

A brief rockets summary (none are recommendations, just timing examples/info):

Because a major market downcycle has begun one has to be very careful about trading rockets right now (should be very careful anyway with rockets), if one trades them at all. Generally it's a good idea to trade with the wind/market at your back. Trading long in the midst of a major or even minor downcycle is risky.

Some new rockets I'm watching are TMY (http://tradethecycles.blogspot.com/2007/10/transmeridian-exploration-inc-tmy.html), Titanium Metals Corp (TIE, strong insider buying), VLNC (strong insider buying), PKTR (insider buying), Linux Gold LNXGF (new Cyclical Bull Market).

Spicy Pickle (SPKL.OB, http://stockcharts.com/charts/gallery.html?spkl) needs to do an Elliott Wave ABC down up down monthly downcycle for about a week before I look to trade it long. I'm excited about trading this one. I probably will trade this one once it does a monthly downcycle.

Lincoln Gold, LGCP.OB (http://stockcharts.com/charts/gallery.html?lgcp) looks good once it does an Elliott Wave ABC down up down monthly downcycle for about a week.

I'm "imminently" looking to/might buy VG (Vonage) for a short term Wave 5 upcycle 1 to 2 week trade (trade a Wave 5 short term upcycle of a monthly upcycle).

I'm looking to trade a tiny ICO (http://stockcharts.com/charts/gallery.html?ico) position once it does Elliott Wave ABC down up down monthly downcycle.

And you gold manipulation theorists, I'm still waiting to hear from you! See http://tradethecycles.blogspot.com/2007/10/to-gold-manipulation-theorists.html.

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

A Gold Sector Massacre Is Rapidly Approaching

A gold sector massacre is rapidly approaching, and, actually began after HUI/XAU's bearish double top on 10-11-07/10-15-07 (http://stockcharts.com/charts/gallery.html?%24hui), which was very likely the Wave 1 Cyclical Bull Market since late 2000 peaking in dramatic rollover mode versus the 5-11-06 cycle highs at 401.69/171.71, and, the only reason that HUI/XAU took out their 5-11-06 cycle highs was probably the huge M2 money supply spike in August due to the mortgage/credit crisis, see http://tradethecycles.blogspot.com/2007/10/huge-spike-in-m2-money-supply-occurred.html.

All of HUI/XAU's 5%ish upside versus the 5-11-06 cycle highs came during a few sessions in October 2007. One would have been better off in a money market account, and, on a risk adjusted basis, forget about it.

90%+ of the gold writers don't have a clue regarding gold sector timing, and, some of the best known gold writers are the some of worst, because they tend to have an oddball or weak minded bullish gold agenda (there are probably a few con artists also). The gold sector is littered with some very odd characters and goofy nitwits. All HUI/XAU did from 5-11-06 until 10-11-07 was rise about 5%.

HUI/XAU are about 50% above their primary Secular Bull market trendlines, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. This means that in the next year or so many gold stocks will fall much more than 50%, and, some might fall 50% or more in the next few weeks. Have you seen a single gold writer use primary trendlines and point out how untimely HUI/XAU are, which is basic technical analysis?

From a long term investors point of view the only time a market or stock is timely is near it's primary trendline. Basic technical analysis. A lot of fortunes will be destroyed in the next few weeks/months.

The following paragraphs are from a previous post.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders continue to go massively short in the five day period ending 10-16-07, adding a large 19,360 short gold futures and options contracts (added 16,788 two weeks ago, added 1751 three weeks ago, added 27,946 four weeks ago, added over 17,000 five weeks ago, and, added a massive 53,207 six weeks ago), while adding 5075 (liquidated 192 two weeks ago, liquidated 5492 three weeks ago, liquidated 2977 four weeks ago) long gold futures and options contracts, correctly anticipating the recent strength.

HUI/XAU put in bearish double top cycle highs on Monday 10-15-07 with Thursday 10-11-07's cycle highs, see http://stockcharts.com/charts/gallery.html?%24hui, which is probably the Cyclical Bull Market since late 2000 peaking in dramatic rollover mode versus 5-11-06's cycle highs.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 5% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking (HUI probably did on 10-11-07, XAU on Monday 10-15-07) in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = +0.32% versus the XAU on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -16.23% versus the XAU the past 40 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 has been lagging HUI/XAU as it tends to do. Gold was still rising after HUI/XAU peaked (http://stockcharts.com/charts/gallery.html?%24gold). HUI probably/very likely peaked on 10-11-07 and the XAU probably/very likely peaked on 10-15-07.

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 (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 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

The S & P 500 (SPX) Short Term Wave A Downcycle Probably Bottomed Today

The S & P 500 (SPX) short term Wave A downcycle (since 10-11-07) probably bottomed today, putting in a bullish slightly lower double bottom with Monday's cycle low, see http://stockcharts.com/charts/gallery.html?%24spx. HUI, XAU, RUT probably put in short term Wave A downcycle (since 10-11-07, 10-15-07 for the XAU) cycle lows on Monday, see http://stockcharts.com/charts/gallery.html?%24spx.

The WMT Lead Indicator was a slightly bullish +0.10% versus SPX today/on 10-24. The NEM Lead Indicator was a modestly bullish +0.32% versus the XAU today/on 10-24.

Since Thursday 10-11-07's likely very important Cyclical Bull Market (and minor intermediate term since 8-16-07) cycle high for SPX (S & P 500) (and HUI), SPX has done a short term Wave A downcycle (did Elliott Wave ABC down up down pattern), that probably bottomed today, 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=.

When SPX (S & P 500), HUI, RUT do/complete a short term countertrend Wave B upcycle for few days/weeks I'm probably going to aggressively (large positions) short GDX, the Gold Miners ETF (tracks HUI), and short the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) via the Ultra Short ETF TWM.

TWM did a big short term Wave 1 upcycle that peaked at 68.69 on Monday 10-22 when RUT's Wave A (probably) bottomed, see http://stockcharts.com/charts/gallery.html?twm. I'll be looking to buy TWM when the short term Wave 2 downcycle bottoms some time in the next few days to a week.

RUT's (Russell 2000) short term countertrend Wave B upcycle should do an Elliott Wave 12345 up down up down up pattern for a few days/weeks. I'll be looking to go short shortly after I think Wave 5 of the short term Wave B has peaked.

Notice that the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) probably peaked in July at 856.48 versus a countertrend Wave B cycle high at 852.06 on 10-11-07, so, RUT is in a substantial Wave C type decline that should bottom well below the Wave A cycle low at 736.00 on 8-16-07. If RUT bottoms at 700ish then it has about 18% to fall from it's countertrend Wave B cycle high at 852.06 on 10-11-07.

The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) is up all of 1.30% from July 2007's cycle high at 1555.90 to 10-11-07's likely Cyclical Bull Market cycle high at 1576.09, thanks to massive Fed credit due to the mortgage/credit crisis. Once the market/SPX breaks down nearly sectors will get whacked. SPX actually broke down a few months ago, hitting a 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, and, the recent strength was rollover action, which was the upcycle/Cyclical Bull Market since October 2002 running out of gas. What was going on in the market was very important peaking action.

The reliable WMT Lead Indicator is extremely bearish, see the six month chart (shows WMT, SPX, HUI relative performance) at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

The point of sell signals is much more to indicate that risk has increased dramatically than it is to be a psychic nailing every cycle high. Double and even triple tops are fairly common, as is rollover action with modestly, and, much less frequently (especially for major 5% sell signals), sometimes substantially higher cycle highs occurring. SPX's (S & P 500) 5% major sell signal, see chart 2 at http://www.joefrocks.com/GoldStockCharts.html, indicated that July's cycle high at 1555.90 was a likely/potential Cyclical Bull Market cycle high, and, more importantly, that trading SPX long was risky, because, a very important cycle trendline had broken down.

The recent gold COT (Commitments Of Traders) data is extremely bearish, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders continue to go massively short in the five day period ending 10-16-07, adding a large 19,360 short gold futures and options contracts (added 16,788 two weeks ago, added 1751 three weeks ago, added 27,946 four weeks ago, added over 17,000 five weeks ago, and, added a massive 53,207 six weeks ago), while adding 5075 (liquidated 192 two weeks ago, liquidated 5492 three weeks ago, liquidated 2977 four weeks ago) long gold futures and options contracts, correctly anticipating the recent strength.

HUI/XAU put in bearish double top cycle highs on Monday 10-15-07 with Thursday 10-11-07's cycle highs, see http://stockcharts.com/charts/gallery.html?%24hui, which is probably the Cyclical Bull Market since late 2000 peaking in dramatic rollover mode versus 5-11-06's cycle highs.

For all practical purposes HUI's Wave 1 Cyclical Bull Market ended on 5-11-06 at 401.69 (XAU at 171.71). HUI/XAU/gold have only risen about 5% from 5-11-06 to the recent cycle highs. Technically HUI/XAU's Wave 1 Cyclical Bull Market is peaking (HUI probably did on 10-11-07, XAU on Monday 10-15-07) in dramatic rollover mode versus 5-11-06's cycle highs at 401.69/171.71 (http://stockcharts.com/charts/gallery.html?%24hui).

Once a sell signal occurs it's time to exit. Actually, I hopefully exit earlier using the Elliott Wave count. The 5% major sell signal, see annotated charts 15 and 18 at http://www.joefrocks.com/GoldStockCharts.html, that occurred in May 2006, correctly indicated that it was time to turn bearish on HUI/XAU.

The NEM Lead Indicator is BIG TIME SCARY. The NEM Lead Indicator = +0.32% versus the XAU today/on 10-24, -1.33% on 10-23, +0.91% on 10-22 (yes, same as Friday), +0.91% on 10-19, -0.88% on 10-18, -2.00% on 10-17, +1.11% on 10-16, -0.31% on 10-15, -0.19% on 10-12, +1.62% on 10-11, -1.28% on 10-10, -0.25% on 10-9, -0.06% on 10-8, -0.57% on 10-5, -1.17% on 10-4, +0.37% on 10-3, +1.35% on 10-2, +0.33% on 10-1, -0.41% on 9-28, -2.21% on 9-27, -4.13% on 9-26, +0.40% on 9-25, +2.03% on 9-24, +0.07% on 9-21, -1.46% on 9-20, +0.69% on 9-19, -2.33% on 9-18, -0.53% on 9-17, +0.12% on 9-14, -1.34% on 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 -16.23% versus the XAU the past 40 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 has been lagging HUI/XAU as it tends to do. Gold was still rising after HUI/XAU peaked (http://stockcharts.com/charts/gallery.html?%24gold). HUI probably/very likely peaked on 10-11-07 and the XAU probably/very likely peaked on 10-15-07.

A brief rockets summary (none are recommendations, just timing examples/info):

Because a major market downcycle has begun one has to be very careful about trading rockets right now (should be very careful anyway with rockets), if one trades them at all. Generally it's a good idea to trade with the wind/market at your back. Trading long in the midst of a major or even minor downcycle is risky.

Some new rockets I'm watching are TMY (http://tradethecycles.blogspot.com/2007/10/transmeridian-exploration-inc-tmy.html), Titanium Metals Corp (TIE, strong insider buying), VLNC (strong insider buying), PKTR (insider buying), Linux Gold LNXGF (new Cyclical Bull Market).

Spicy Pickle (SPKL.OB, http://stockcharts.com/charts/gallery.html?spkl) needs to do an Elliott Wave ABC down up down monthly downcycle for about a week before I look to trade it long. I'm excited about trading this one. I probably will trade this one once it does a monthly downcycle.

Lincoln Gold, LGCP.OB (http://stockcharts.com/charts/gallery.html?lgcp) looks good once it does an Elliott Wave ABC down up down monthly downcycle for about a week.

I'm "imminently" looking to/might buy VG (Vonage) for a short term Wave 5 upcycle 1 to 2 week trade (trade a Wave 5 short term upcycle of a monthly upcycle).

I'm looking to trade a tiny ICO (http://stockcharts.com/charts/gallery.html?ico) position once it does Elliott Wave ABC down up down monthly downcycle.

And you gold manipulation theorists, I'm still waiting to hear from you! See http://tradethecycles.blogspot.com/2007/10/to-gold-manipulation-theorists.html.

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