.......SPX (S & P 500) Was Down -3.20% Today
SPX (S & P 500) was down an unusually large (for SPX) -3.20% today, see http://stockcharts.com/charts/gallery.html?%24spx. Looking at the daily chart in the previous link today's decline appears to be Wave A of the short term Wave 2 downcycle that began early on Friday, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
Also, reliable lead indicator WMT has a very large bearish spike on today's candle, see http://stockcharts.com/charts/gallery.html?wmt, but, the WMT Lead Indicator was an extremely bullish +2.18% versus SPX (S & P 500) today, which actually might be a very short term bearish sign, that it got so bullish and SPX didn't respond.
After such a large decline and the extremely bullish WMT Lead Indicator today it's likely that SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24spx) (and most indexes) will rebound significantly tomorrow, which will probably be a countertrend Wave B upcycle of the short term Wave 2 downcycle that began early on Friday, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
I'll probably be looking to go ultra short the major averages via SDS, QID, or TWM tomorrow, possibly for only a day trade. Given that the WMT Lead Indicator was an extremely bullish +2.18% versus SPX (S & P 500) today/on 2-5, I'll have to convince myself tomorrow that SPX didn't enter a short term Wave 3 upcycle.
Wave A intermediate term (Cyclical Bear Market began 10-11-07 for SPX, late October 2007 for NDX, late July 2007 for RUT) cycle lows occurred on 1-23 for SPX/NDX and on 1-22 for RUT (Russell 2000), so, SPX/NDX/RUT are in a countertrend Wave B minor intermediate term upcycle.
NEM failed to fill today's upside gap at 50.91, HUI failed to fill today's upside gap at 438.93, GDX failed to fill today's upside gap at 48.15, and, the XAU failed to fill today's upside gap at 180.24. However, it looks like Wave A down of the short term Wave C downcycle since 1-30-08 is in the process of bottoming, and, might have done so late today or might do so early tomorrow, see http://stockcharts.com/charts/gallery.html?%24hui, and, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=. The NEM Lead Indicator became more bullish just before session's end, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
The NEM Lead Indicator was a very bullish +1.08% versus the XAU today/on 2-5, which very strongly agrees with the WMT Lead Indicator, that was an extremely bullish +2.18% versus SPX (S & P 500) today/on 2-5. When both the NEM and WMT Lead Indicators strongly agree that usually points to a strong move the next day or two for HUI/XAU/gold.
So, some time in the next day or two there should be another good opportunity to short GDX, the Gold Miners ETF, that closely tracks the AMEX Gold Bugs Index (HUI), but, is based on the AMEX Gold Miners Index.
GDX (Gold Miners ETF) has downside gaps at 44.33 and 42.87 that will probably get filled in the short term Wave C downcycle (cycle low target 42.50), see http://stockcharts.com/charts/gallery.html?gdx. Also, watch the XAU's downside gap at 161.75, and, watch NEM's downside gap at 47.39.
The short term Wave C cycle low target for HUI/XAU/GDX/NEM based on gaps is 161 for the XAU (shortly after filling the downside gap at 161.75), 380-400 for HUI (I need to check the less straightforward HUI historical data to finetune the target), 42.50 for GDX (shortly after filling the downside gap at 42.87), and 47 for NEM (shortly after filling the downside gap at 47.39).
One can look at the daily charts for HUI/XAU/GDX/NEM (http://stockcharts.com/charts/gallery.html?%24xau) and see that the Wave C cycle low targets are reasonable, based on where the short term Wave A cycle lows occurred.
Since 11-7-07 the XAU has had only one session (1-14-08) where it made any upside progress (HUI had three), see http://stockcharts.com/charts/gallery.html?%24xau. The XAU obviously dramatically rolled over, probably put in a Wave 1 Cyclical Bull Market cycle high on 1-14-08 at 199.25, then put in a short term countertrend Wave B cycle high on 1-30-08, see the new annotated XAU candlestick chart dated 1-30-08, see chart one at http://www.joefrocks.com/GoldStockCharts.html.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Also, reliable lead indicator WMT has a very large bearish spike on today's candle, see http://stockcharts.com/charts/gallery.html?wmt, but, the WMT Lead Indicator was an extremely bullish +2.18% versus SPX (S & P 500) today, which actually might be a very short term bearish sign, that it got so bullish and SPX didn't respond.
After such a large decline and the extremely bullish WMT Lead Indicator today it's likely that SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24spx) (and most indexes) will rebound significantly tomorrow, which will probably be a countertrend Wave B upcycle of the short term Wave 2 downcycle that began early on Friday, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
I'll probably be looking to go ultra short the major averages via SDS, QID, or TWM tomorrow, possibly for only a day trade. Given that the WMT Lead Indicator was an extremely bullish +2.18% versus SPX (S & P 500) today/on 2-5, I'll have to convince myself tomorrow that SPX didn't enter a short term Wave 3 upcycle.
Wave A intermediate term (Cyclical Bear Market began 10-11-07 for SPX, late October 2007 for NDX, late July 2007 for RUT) cycle lows occurred on 1-23 for SPX/NDX and on 1-22 for RUT (Russell 2000), so, SPX/NDX/RUT are in a countertrend Wave B minor intermediate term upcycle.
NEM failed to fill today's upside gap at 50.91, HUI failed to fill today's upside gap at 438.93, GDX failed to fill today's upside gap at 48.15, and, the XAU failed to fill today's upside gap at 180.24. However, it looks like Wave A down of the short term Wave C downcycle since 1-30-08 is in the process of bottoming, and, might have done so late today or might do so early tomorrow, see http://stockcharts.com/charts/gallery.html?%24hui, and, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=. The NEM Lead Indicator became more bullish just before session's end, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
The NEM Lead Indicator was a very bullish +1.08% versus the XAU today/on 2-5, which very strongly agrees with the WMT Lead Indicator, that was an extremely bullish +2.18% versus SPX (S & P 500) today/on 2-5. When both the NEM and WMT Lead Indicators strongly agree that usually points to a strong move the next day or two for HUI/XAU/gold.
So, some time in the next day or two there should be another good opportunity to short GDX, the Gold Miners ETF, that closely tracks the AMEX Gold Bugs Index (HUI), but, is based on the AMEX Gold Miners Index.
GDX (Gold Miners ETF) has downside gaps at 44.33 and 42.87 that will probably get filled in the short term Wave C downcycle (cycle low target 42.50), see http://stockcharts.com/charts/gallery.html?gdx. Also, watch the XAU's downside gap at 161.75, and, watch NEM's downside gap at 47.39.
The short term Wave C cycle low target for HUI/XAU/GDX/NEM based on gaps is 161 for the XAU (shortly after filling the downside gap at 161.75), 380-400 for HUI (I need to check the less straightforward HUI historical data to finetune the target), 42.50 for GDX (shortly after filling the downside gap at 42.87), and 47 for NEM (shortly after filling the downside gap at 47.39).
One can look at the daily charts for HUI/XAU/GDX/NEM (http://stockcharts.com/charts/gallery.html?%24xau) and see that the Wave C cycle low targets are reasonable, based on where the short term Wave A cycle lows occurred.
Since 11-7-07 the XAU has had only one session (1-14-08) where it made any upside progress (HUI had three), see http://stockcharts.com/charts/gallery.html?%24xau. The XAU obviously dramatically rolled over, probably put in a Wave 1 Cyclical Bull Market cycle high on 1-14-08 at 199.25, then put in a short term countertrend Wave B cycle high on 1-30-08, see the new annotated XAU candlestick chart dated 1-30-08, see chart one at http://www.joefrocks.com/GoldStockCharts.html.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:54 PM
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