The US Dollar COT (Commitments Of Traders) Data Points To Strength Next Week
The US Dollar COT (Commitments Of Traders) data points to strength next week, see the last/sixth data at http://www.cftc.gov/dea/options/deanybtsof.htm, since the savvy non contrarian USD Commercial Traders traded aggressively net long in the five day period ending 2-19-08, as they've done nearly every week for the past few months, and, the US Dollar probably entered a Cyclical Bull Market in November 2007 after being in a Cyclical Bear Market that began in late 2005, see http://stockcharts.com/charts/gallery.html?%24usd.
Even the usually clueless/contrarian USD Speculators expect some significant strength next week, since they increased their long position by over 20%, which makes them short term non contrarian. They also increased their short position by over 20%, which means they correctly expected some weakness, which was probably the weakness that already occurred this week.
The gold COT (Commitments Of Traders) data points to weakness next week, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm, since the savvy non contrarian gold Commercial Traders traded significantly net short in the five day period ending 2-19-08. They correctly anticipated some strength, with the significant long trade, which was the strength that occurred this week, and, they expect a sharp decline, since they traded aggressively short, which appears to have begun late this week.
It's very likely that HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) entered a 12-18 month Wave 2 Cyclical Bear Market on 1-14-08. I've known this since shortly after the 1-14-08 cycle highs occurred. The obvious sign was the dramatic rollover action by HUI/XAU, in which HUI only made upside progress in three sessions from the 11-7-07 cycle high to the 1-14-08 cycle high, and, the XAU only made upside progress in one session from the 11-7-07 cycle high to the 1-14-08 cycle high.
HUI is now in the "apocalyptic" Wave C of a short term Wave C downcycle, in which the XAU should bottom at 161ish shortly after filling it's downside gap at 161.75, and GDX, the Gold Miners ETF, should bottom at 42.50ish shortly after filling it's downside gap at 42.87.
HUI (http://stockcharts.com/charts/gallery.html?%24hui) is in a second/Wave 3 of a very short term countertrend Wave B move since putting in a Wave B of a short term Wave C (began 1-30-08) cycle high at 477.73 on Thursday 2-21, 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=. The nearly -5% Wave A move from 477.73 to 454.23 in less than a session's time bottomed early Friday 2-22. I'll be looking to go short GDX, the Gold Miners ETF, on Monday, and, I might buy some XAU put options.
The NEM Lead Indicator was a bearish -0.84% versus the XAU on Friday 2-22, and, the five day NEM Lead Indicator is extremely bearish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem. The NEM Lead Indicator is extremely bearish in February, at -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
Even the usually clueless/contrarian USD Speculators expect some significant strength next week, since they increased their long position by over 20%, which makes them short term non contrarian. They also increased their short position by over 20%, which means they correctly expected some weakness, which was probably the weakness that already occurred this week.
The gold COT (Commitments Of Traders) data points to weakness next week, see the last/third data at http://www.cftc.gov/dea/options/deacmxsof.htm, since the savvy non contrarian gold Commercial Traders traded significantly net short in the five day period ending 2-19-08. They correctly anticipated some strength, with the significant long trade, which was the strength that occurred this week, and, they expect a sharp decline, since they traded aggressively short, which appears to have begun late this week.
It's very likely that HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) entered a 12-18 month Wave 2 Cyclical Bear Market on 1-14-08. I've known this since shortly after the 1-14-08 cycle highs occurred. The obvious sign was the dramatic rollover action by HUI/XAU, in which HUI only made upside progress in three sessions from the 11-7-07 cycle high to the 1-14-08 cycle high, and, the XAU only made upside progress in one session from the 11-7-07 cycle high to the 1-14-08 cycle high.
HUI is now in the "apocalyptic" Wave C of a short term Wave C downcycle, in which the XAU should bottom at 161ish shortly after filling it's downside gap at 161.75, and GDX, the Gold Miners ETF, should bottom at 42.50ish shortly after filling it's downside gap at 42.87.
HUI (http://stockcharts.com/charts/gallery.html?%24hui) is in a second/Wave 3 of a very short term countertrend Wave B move since putting in a Wave B of a short term Wave C (began 1-30-08) cycle high at 477.73 on Thursday 2-21, 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=. The nearly -5% Wave A move from 477.73 to 454.23 in less than a session's time bottomed early Friday 2-22. I'll be looking to go short GDX, the Gold Miners ETF, on Monday, and, I might buy some XAU put options.
The NEM Lead Indicator was a bearish -0.84% versus the XAU on Friday 2-22, and, the five day NEM Lead Indicator is extremely bearish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem. The NEM Lead Indicator is extremely bearish in February, at -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
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, XAU
posted by Joe Ferrazzano at
10:30 AM
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