GDX/HUI/XAU/GLD's Big Short Term Wave A Downcycle Might Have But Probably Didn't Bottom
GDX/HUI/XAU/GLD's big short term Wave A downcycle since 7-15 might have (doubtful) bottomed today 7-29, see http://stockcharts.com/charts/gallery.html?gdx, and, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c.
However, since reliable lead indicator NEM doesn't appear to have bottomed (Wave 2 minor intermediate term downcycle since early July (53.77 cycle high)) on it's daily chart (http://stockcharts.com/charts/gallery.html?nem) it's doubtful that GDX/HUI/XAU/GLD's big short term Wave A downcycle since 7-15 has bottomed.
However, NEM's breakaway gap at 46.95 from 7-24 held today, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, so, we'll see what happens tomorrow. I'll probably be looking to short NEM or GDX (Gold Miners ETF) tomorrow. I might also trade DZZ, the double short gold ETN.
The NEM Lead Indicator was a slightly bullish +0.05% versus the XAU today/on 7-29, and, was a modestly bearish -0.42% versus the XAU yesterday/on 7-28.
NEM's cycle low last Thursday 7-24 appears to be Wave A of Wave C of Wave C of the Wave 2 minor intermediate term downcycle since early July (53.77 cycle high). NEM's bearish large spikes on it's daily candles the previous three days correctly pointed to weakness today, see http://stockcharts.com/charts/gallery.html?nem.
The XAU had a bearish large spike on yesterday 7-28's candle, see http://stockcharts.com/charts/gallery.html?%24xau.
Watch downside gaps at 45.10, 42.29 (shouldn't get filled as previously discussed), and 41.52 (shouldn't get filled as previously discussed) for NEM, and, at 43.88 (filled on 7-24) and 42.65 for GDX. Downside gaps to watch for GLD (Gold ETF) are 91.50 (filled 7-23), 87.42, 85.83, and, 84.58. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06.
Reliable lead indicator NEM is in Wave C down of a Wave 2 minor intermediate term downcycle, see http://stockcharts.com/charts/gallery.html?nem. NEM created large bullish breakaway gaps at 45.10 on 5-15 and 47.90 on 6-6 (filled 6-10), and, another one at 46.73 on 5-16 that got filled on 5-29 (46.50 cycle low on 5-29). NEM filled it's bearish upside breakaway gap at 48.72 from 3-20 on 5-15, which confirmed the 5% follow through major buy signal.
Reliable lead indicator NEM put in a Wave 2 major intermediate term cycle low on 5-1 at 42.36 (StockCharts uses slightly different price data ???, for reasons which escape me, there obviously needs to be consistency), see http://stockcharts.com/charts/gallery.html?nem, then, obviously 42.29 and 41.52 shouldn't get filled/should be bullish breakaway gaps. Wave 1 peaked in January at 57.44 and NEM entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
GDX/HUI/XAU/GLD entered Wave C of the big Short Term Wave A Downcycle since 7-15-08 early on 7-22, 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, see http://stockcharts.com/charts/gallery.html?gdx.
GDX/HUI/XAU/GLD entered Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 7-15-08, see http://stockcharts.com/charts/gallery.html?gdx.
HUI/XAU put in an intermediate term and very likely a Wave 1 Cyclical Bull Market cycle high on 3-17 for HUI and on 3-14 for the XAU, see http://stockcharts.com/charts/gallery.html?%5Ehui. The XAU has a large bearish spike on 3-14's candle.
The NEM Lead Indicator was a slightly bullish +0.05% versus the XAU today/on 7-29, was a modestly bearish -0.42% on 7-28, was +0.12% on 7-25, was an extremely bullish +5.67% on 7-24, was a bullish +0.83% on 7-23, was an extremely bullish +2.51% on 7-22, was +0.71% on 7-21, was +0.62% on 7-18, was a very bearish -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15, -1.91% on 7-14, +0.22% on 7-11, +0.65% on 7-10, -0.71% on 7-9, -0.28% on 7-8, -0.85% on 7-7, -0.80% on 7-3, -0.82% on 7-2, +1.15% on 7-1, -1.38% on 6-30, -2.45% on 6-27, -0.95% on 6-26, -0.08% on 6-25.
SPX (S & P 500) is in Wave B of the short term Wave 2 downcycle since Wednesday 7-23, see http://stockcharts.com/charts/gallery.html?%24spx.
I'll look to trade RUT's (Russell 2000) short term Wave 2 downcycle ultra short via TWM tomorrow, once I'm convinced that Wave B of Wave 2 has peaked. It looks like there will be a good shorting opportunity early tomorrow, see http://finance.yahoo.com/q/ta?s=%5Erut&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
RUT's short term Wave 2 downcycle should bottom well below the Wave A of Wave 2 cycle low that occurred yesterday, see http://stockcharts.com/charts/gallery.html?%24rut.
VIX fell an unusually large -9.25% today 7-29 versus SPX rising a sharp +2.34%, which is an unusually large +6.91% rise in complacency (-9.25% + +2.34% = -6.91% decline in the SPX (S & P 500) wall of worry) that points to some significant strength early on Wednesday 7-30, followed by weakness.
SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) probably finally bottomed on 7-15, see http://stockcharts.com/charts/gallery.html?%24spx, http://stockcharts.com/charts/gallery.html?%24ndx, and http://stockcharts.com/charts/gallery.html?%24rut.
SPX's big short term Wave 1 upcycle peaked in rollover mode on 7-23, and, is doing Wave B of a short term Wave 2 downcycle since early on 7-23, 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.
Walmart (WMT) created an upside gap at 59.06 on 7-23.
7-15's very bullish candles and the strong short term Wave 1 upcycle suggest that SPX/NDX/RUT probably finally bottomed. RUT's chart is the most bullish, with the largest bullish inverse spike and best chart.
SPX probably put in a Wave A major intermediate term (since 10-11-07) cycle low on 7-15-08, and, NDX/RUT probably put in a Wave 2 minor intermediate term cycle low on 7-15-08, for the countertrend Wave B major intermediate term upcycle since 3-17-08 for NDX and since 3-10-08 for RUT.
The WMT (Walmart) Lead Indicator was a slightly bullish +0.21% versus the S & P 500 (SPX) today 7-29, was a modestly bullish +0.43% on 7-28, was a bearish -0.67% on 7-25, was +0.38% on 7-24, was an extremely bearish -2.05% on 7-23, was a very bullish +1.70% on 7-22, was a very bearish -1.00% on 7-21, was +0.39% on 7-18, was +0.06% on 7-17, was -0.32% on 7-16, was +0.97% on 7-15, +0.94% on 7-14, -0.50% on 7-11, was a very bearish -1.50% on 7-10, -0.16% on 7-9, +2.16% on 7-8, +1.39% on 7-7, +0.07% on 7-3, +0.89% on 7-2, +1.10% on 7-1, -0.31% on 6-30, -0.56% on 6-27, +0.72% on 6-26, +0.82% on 6-25, +1.48% on 6-24, +0.67% on 6-23. The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength (began on 7-15-08).
Trade the Cycles won't indicate that a major cycle low very likely occurred until a 5% follow through major buy signal occurs, but, since a strong short term Wave 1 upcycle occurred, then SPX has probably bottomed (on 7-15-08).
At least waiting for a strong multi day short term Wave 1 upcycle (typically about 2 to 3 sessions, which occurred/peaked on 7-23) before looking to trade long overnight, then, one should wait for a pullback/short term Wave 2 downcycle (typically about 1.5 to 3 sessions, began early on 7-23) before trading long overnight (look to go long early in a short term Wave 3 upcycle, that typically lasts 3 to 5 sessions).
Since SPX (S & P 500) probably bottomed I'll look to trade rockets. It makes a lot of sense to trade with the wind at your back.
Once SPX puts in a Wave A major intermediate term cycle low (probably did on 7-15-08) watch upside gaps at 1321.97, 1342.83, 1350.93, 1404.05, 1426.63, 1447.16, 1467.95, 1488.41, and, there are probably additional upside gaps I need to identify.
The Upside Surprise/Rollover Barometer is at "Likely" due to the aggressive Fed credit extended since 2-28-08, that fuels index related program buying ("only" 70% of the dollar volume on the NYSE), see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE.
A Cyclical Bear Market probably/very likely began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), and, began in late July 2007 for RUT (Russell 2000).
.......http://www.JoeFRocks.com/
NEM XAU HUI
However, since reliable lead indicator NEM doesn't appear to have bottomed (Wave 2 minor intermediate term downcycle since early July (53.77 cycle high)) on it's daily chart (http://stockcharts.com/charts/gallery.html?nem) it's doubtful that GDX/HUI/XAU/GLD's big short term Wave A downcycle since 7-15 has bottomed.
However, NEM's breakaway gap at 46.95 from 7-24 held today, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, so, we'll see what happens tomorrow. I'll probably be looking to short NEM or GDX (Gold Miners ETF) tomorrow. I might also trade DZZ, the double short gold ETN.
The NEM Lead Indicator was a slightly bullish +0.05% versus the XAU today/on 7-29, and, was a modestly bearish -0.42% versus the XAU yesterday/on 7-28.
NEM's cycle low last Thursday 7-24 appears to be Wave A of Wave C of Wave C of the Wave 2 minor intermediate term downcycle since early July (53.77 cycle high). NEM's bearish large spikes on it's daily candles the previous three days correctly pointed to weakness today, see http://stockcharts.com/charts/gallery.html?nem.
The XAU had a bearish large spike on yesterday 7-28's candle, see http://stockcharts.com/charts/gallery.html?%24xau.
Watch downside gaps at 45.10, 42.29 (shouldn't get filled as previously discussed), and 41.52 (shouldn't get filled as previously discussed) for NEM, and, at 43.88 (filled on 7-24) and 42.65 for GDX. Downside gaps to watch for GLD (Gold ETF) are 91.50 (filled 7-23), 87.42, 85.83, and, 84.58. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06.
Reliable lead indicator NEM is in Wave C down of a Wave 2 minor intermediate term downcycle, see http://stockcharts.com/charts/gallery.html?nem. NEM created large bullish breakaway gaps at 45.10 on 5-15 and 47.90 on 6-6 (filled 6-10), and, another one at 46.73 on 5-16 that got filled on 5-29 (46.50 cycle low on 5-29). NEM filled it's bearish upside breakaway gap at 48.72 from 3-20 on 5-15, which confirmed the 5% follow through major buy signal.
Reliable lead indicator NEM put in a Wave 2 major intermediate term cycle low on 5-1 at 42.36 (StockCharts uses slightly different price data ???, for reasons which escape me, there obviously needs to be consistency), see http://stockcharts.com/charts/gallery.html?nem, then, obviously 42.29 and 41.52 shouldn't get filled/should be bullish breakaway gaps. Wave 1 peaked in January at 57.44 and NEM entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
GDX/HUI/XAU/GLD entered Wave C of the big Short Term Wave A Downcycle since 7-15-08 early on 7-22, 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, see http://stockcharts.com/charts/gallery.html?gdx.
GDX/HUI/XAU/GLD entered Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 7-15-08, see http://stockcharts.com/charts/gallery.html?gdx.
HUI/XAU put in an intermediate term and very likely a Wave 1 Cyclical Bull Market cycle high on 3-17 for HUI and on 3-14 for the XAU, see http://stockcharts.com/charts/gallery.html?%5Ehui. The XAU has a large bearish spike on 3-14's candle.
The NEM Lead Indicator was a slightly bullish +0.05% versus the XAU today/on 7-29, was a modestly bearish -0.42% on 7-28, was +0.12% on 7-25, was an extremely bullish +5.67% on 7-24, was a bullish +0.83% on 7-23, was an extremely bullish +2.51% on 7-22, was +0.71% on 7-21, was +0.62% on 7-18, was a very bearish -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15, -1.91% on 7-14, +0.22% on 7-11, +0.65% on 7-10, -0.71% on 7-9, -0.28% on 7-8, -0.85% on 7-7, -0.80% on 7-3, -0.82% on 7-2, +1.15% on 7-1, -1.38% on 6-30, -2.45% on 6-27, -0.95% on 6-26, -0.08% on 6-25.
SPX (S & P 500) is in Wave B of the short term Wave 2 downcycle since Wednesday 7-23, see http://stockcharts.com/charts/gallery.html?%24spx.
I'll look to trade RUT's (Russell 2000) short term Wave 2 downcycle ultra short via TWM tomorrow, once I'm convinced that Wave B of Wave 2 has peaked. It looks like there will be a good shorting opportunity early tomorrow, see http://finance.yahoo.com/q/ta?s=%5Erut&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
RUT's short term Wave 2 downcycle should bottom well below the Wave A of Wave 2 cycle low that occurred yesterday, see http://stockcharts.com/charts/gallery.html?%24rut.
VIX fell an unusually large -9.25% today 7-29 versus SPX rising a sharp +2.34%, which is an unusually large +6.91% rise in complacency (-9.25% + +2.34% = -6.91% decline in the SPX (S & P 500) wall of worry) that points to some significant strength early on Wednesday 7-30, followed by weakness.
SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) probably finally bottomed on 7-15, see http://stockcharts.com/charts/gallery.html?%24spx, http://stockcharts.com/charts/gallery.html?%24ndx, and http://stockcharts.com/charts/gallery.html?%24rut.
SPX's big short term Wave 1 upcycle peaked in rollover mode on 7-23, and, is doing Wave B of a short term Wave 2 downcycle since early on 7-23, 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.
Walmart (WMT) created an upside gap at 59.06 on 7-23.
7-15's very bullish candles and the strong short term Wave 1 upcycle suggest that SPX/NDX/RUT probably finally bottomed. RUT's chart is the most bullish, with the largest bullish inverse spike and best chart.
SPX probably put in a Wave A major intermediate term (since 10-11-07) cycle low on 7-15-08, and, NDX/RUT probably put in a Wave 2 minor intermediate term cycle low on 7-15-08, for the countertrend Wave B major intermediate term upcycle since 3-17-08 for NDX and since 3-10-08 for RUT.
The WMT (Walmart) Lead Indicator was a slightly bullish +0.21% versus the S & P 500 (SPX) today 7-29, was a modestly bullish +0.43% on 7-28, was a bearish -0.67% on 7-25, was +0.38% on 7-24, was an extremely bearish -2.05% on 7-23, was a very bullish +1.70% on 7-22, was a very bearish -1.00% on 7-21, was +0.39% on 7-18, was +0.06% on 7-17, was -0.32% on 7-16, was +0.97% on 7-15, +0.94% on 7-14, -0.50% on 7-11, was a very bearish -1.50% on 7-10, -0.16% on 7-9, +2.16% on 7-8, +1.39% on 7-7, +0.07% on 7-3, +0.89% on 7-2, +1.10% on 7-1, -0.31% on 6-30, -0.56% on 6-27, +0.72% on 6-26, +0.82% on 6-25, +1.48% on 6-24, +0.67% on 6-23. The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength (began on 7-15-08).
Trade the Cycles won't indicate that a major cycle low very likely occurred until a 5% follow through major buy signal occurs, but, since a strong short term Wave 1 upcycle occurred, then SPX has probably bottomed (on 7-15-08).
At least waiting for a strong multi day short term Wave 1 upcycle (typically about 2 to 3 sessions, which occurred/peaked on 7-23) before looking to trade long overnight, then, one should wait for a pullback/short term Wave 2 downcycle (typically about 1.5 to 3 sessions, began early on 7-23) before trading long overnight (look to go long early in a short term Wave 3 upcycle, that typically lasts 3 to 5 sessions).
Since SPX (S & P 500) probably bottomed I'll look to trade rockets. It makes a lot of sense to trade with the wind at your back.
Once SPX puts in a Wave A major intermediate term cycle low (probably did on 7-15-08) watch upside gaps at 1321.97, 1342.83, 1350.93, 1404.05, 1426.63, 1447.16, 1467.95, 1488.41, and, there are probably additional upside gaps I need to identify.
The Upside Surprise/Rollover Barometer is at "Likely" due to the aggressive Fed credit extended since 2-28-08, that fuels index related program buying ("only" 70% of the dollar volume on the NYSE), see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE.
A Cyclical Bear Market probably/very likely began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), and, began in late July 2007 for RUT (Russell 2000).
.......http://www.JoeFRocks.com/
NEM XAU HUI
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:32 PM
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