............Interpreting The NEM Lead Indicator

The more important the cycle high (or cycle low) the longer the lag time tends to be between what the NEM Lead Indicator indicates (severe weakness/a dramatic decline in this case) and when it occurs, because, a longer upcycle (or downcycle bottoming) is peaking.

There's a definite chance that HUI (http://stockcharts.com/charts/gallery.html?%24hui) put in a Wave 1 Cyclical Bull Market (began November 2000) cycle high today at 495.78, rolling over versus the 1-14-08, 11-7-07, and 5-11-06 cycle highs.

The major intermediate term upcycle since 8-16-07 is probably the final Wave 5 spike move that punctuates/marks the end of the Wave 1 Cyclical Bull Market. Sometimes, long after an upcycle appears to have peaked (in this case 5-11-06) a huge spike move occurs that marks the end of the upcycle. The larger the spike move the more important the peaking action usually is. The huge spike move since 8-16-07 for HUI/XAU clearly points to very important peaking action.

Since 1-30-08's cycle high at 489.49 to today 2-28's cycle high at 495.78 HUI has risen only +1.29% in about a month's time, which is obviously dramatic rollover action that points to important peaking action. The bullish agenda nitwits are getting excited about a very anemic gold stock market.

See the extremely bearish five day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem, and, see the extremely bearish three month NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.

The NEM Lead Indicator is extremely bearish in February, at -0.58% versus the XAU on 2-27, at +0.09% on 2-26, -0.96% on 2-25, -0.84% on 2-22, -1.53% on 2-21, -0.53% on 2-20, +0.46% on 2-19, -1.65% on 2-15, -0.03% on 2-14, +0.08% on 2-13, -1.79% on 2-12, -1.18% on 2-11, -1.51% on 2-8, +0.75% on 2-7, -0.21% on 2-6, +1.08% on 2-5, -1.99% on 2-4, -0.97% on 2-1.

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

HUI NEM XAU