GDX/GLD/HUI/XAU/NEM's Bearish Breakaway Gaps Probably Point To More Downside
GDX/GLD/HUI/XAU/NEM's (http://stockcharts.com/charts/gallery.html?gdx) bearish breakaway gaps at today 8-15's open probably point to more downside, 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=. The fact that they didn't make a serious or even weak attempt at filling today's upside gaps (usually) points to more downside.
Also, since GDX's (Gold Miners ETF) gap is a relatively large one, opening at 35.00 versus yesterday 8-14's close at 35.87, that's another sign that GDX will probably (at least try to) fill it's downside gap at 32.20 early next week. I'll be looking to short GDX early on Monday. I'll also be looking to ultra short probably the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) via TWM.
I didn't hold a GDX short position overnight, because, the sector NEM Lead Indicator was a modestly bullish +0.45% versus the XAU today 8-15, and, the broad market Walmart (WMT) Lead Indicator, used in concert with the sector lead indicator, was a very bullish +1.78% versus the S & P 500 (SPX) today. Also, GDX has an Elliott Wave down up down pattern the last four hours of the session, see http://finance.yahoo.com/q/ta?s=GDX&t=1d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, so, there might be a bounce early on Monday. There also obviously might be a sharp plunge at Monday's open.
The latest gold COT data for the five day period ending 8-12-08 jives with Wave A down of gold's Wave 2 Cyclical Bear Market since 3-17-08 bottoming soon, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders engaged in massive short covering for the second straight week, and, for the first time in a while they entered a respectable long trade.
GDX (Gold Miners ETF) should bottom well below 8-11's cycle low at 33.86, assuming that the upcycle since 8-11 (probably peaked) was countertrend action. Since GDX has a downside gap at 32.20, 32 is a reasonable cycle low target for Wave C of the Wave A Major Intermediate Term Downcycle since mid March, which is Wave A down of the Wave 2 Cyclical Bear Market. Often important cycle highs/lows tend to occur shortly after gap filling action has been completed.
NEM created what appeared to be a bullish breakaway gap at 8-13's open at 42.36, and, GDX did so at 35.37, HUI did so at 324.45, and, the XAU did so at 140.84. They all got filled as expected today.
The GDX/HUI/XAU/GLD crash since 7-15-08 (Wave C of the Wave A Major Intermediate Term Downcycle since mid March) probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?gdx, because, there isn't a large bullish inverse spike on 8-11's candle.
Reliable lead indicator NEM has a respectably large bullish inverse spike on 8-11's candle, and, might have bottomed on 8-11, see http://stockcharts.com/charts/gallery.html?nem, and, NEM took out the cycle low that occurred in early May (which was a surprise), so, NEM is putting in/put in a Wave 2 major intermediate term cycle low, not a Wave 2 minor intermediate term cycle low.
The Wave 1 major intermediate term upcycle 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.
NEM filled downside gaps at 42.29 and 41.52 on 8-11, which is another sign that an important cycle low is probably imminent. Also, volume was an extremely high 15.335 million shares on 8-11, and, volatility has obviously been extreme as well, which are additional signs that a very important cycle low is imminent.
The NEM Lead Indicator was a modestly bullish +0.45% versus the XAU today 8-15, was a very bullish +1.48% on 8-14, was a very bearish -1.62% on 8-13, was a very bearish -1.03% 8-12, was a bullish +0.65% on 8-11, and, has been extremely bullish recently, at +1.90% on 8-8, +1.26% on 8-7, -1.82% on 8-6, -0.15% on 8-5, +2.29% on 8-4, +2.28% on 8-1, +1.08% on 7-31, -0.55% on 7-30, +0.05% on 7-29, -0.42% on 7-28, +0.12% on 7-25, +5.67% on 7-24, +0.83% on 7-23, +2.51% on 7-22, +0.71% on 7-21, +0.62% on 7-18, -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15.
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.
The US Dollar entered a Wave 3 Minor Intermediate Term Upcycle on 7-15-08, see http://stockcharts.com/charts/gallery.html?%24usd, and, entered a Cyclical Bull Market within a Secular Bear Market on 3-17-08, after putting in a cycle low at 70.698. Note the very large bullish inverse spike on 3-17-08's and 7-15-08's candle.
GDX created an upside gap at 35.87 on 8-15, NEM did so at 42.89, GLD did so at 79.35, HUI did so at 327.350, and, the XAU did so at 142.62. GLD created an upside gap at 81.13 on 8-12. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8, GDX created one at 38.92, HUI created one at 356.72, the XAU created one at 151.14, and, GLD created one at 86.09. Reliable lead indicator NEM created a downside gap at 43.75 on 8-6, and, GDX created one at 38.59, that both got filled on 8-8. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06.
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.
SPX's (S & P 500) short term Wave 3 upcycle since late July peaked in deceptive rollover mode on 8-11 (spike on 8-11's daily candle), that has an Elliott Wave 12345 up down up down up pattern (see daily chart), see the 5 day intraday candlestick chart at 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, and, see the daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24spx.
For day trading trading purposes I'll be looking at trading WMT short, or, SPX, NDX, or RUT (RUT looks like it might be the best short for Monday, see http://stockcharts.com/charts/gallery.html?%24rut) ultra short via SDS, QID, or TWM on Monday, 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. The WMT (Walmart) Lead Indicator was a very bullish +1.78% versus SPX (S & P 500) today/on 8-15.
WMT created a downside gap on 8-15 at 58.10, and, SPX has one at 1249.01 from 8-5. WMT has upside gaps at 60.76, 59.25 and SPX has one at 1305.31.
VIX fell a very sharp -3.64% today 8-15 versus SPX rising a modest +0.41%, which is a very sharp +3.23% rise in complacency (-3.64% + +0.41% = -3.23% decline in the SPX (S & P 500) wall of worry) that points to some very sharp weakness early on Monday 8-18.
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. 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 very bullish +1.78% versus SPX (S & P 500) today/on 8-15, was a slightly bearish -0.17% on 8-14, was an extremely bearish -2.02% on 8-13, was an extremely bullish +2.39% on 8-12, was a bullish +0.52% on 8-11, was a bearish -0.81% on 8-8, was an extremely bearish -4.46% on 8-7, was +0.36% on 8-6, was +0.40% on 8-5, was an extremely bullish +2.08% on 8-4, was a bearish -0.92% on 8-1, was a very bullish +1.41% on 7-31, +0.26% on 7-30, +0.21% on 7-29, +0.43% on 7-28, -0.67% on 7-25, +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, +0.39% on 7-18, +0.06% on 7-17, -0.32% on 7-16, +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) 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) 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
Also, since GDX's (Gold Miners ETF) gap is a relatively large one, opening at 35.00 versus yesterday 8-14's close at 35.87, that's another sign that GDX will probably (at least try to) fill it's downside gap at 32.20 early next week. I'll be looking to short GDX early on Monday. I'll also be looking to ultra short probably the Russell 2000 (RUT, http://stockcharts.com/charts/gallery.html?%24rut) via TWM.
I didn't hold a GDX short position overnight, because, the sector NEM Lead Indicator was a modestly bullish +0.45% versus the XAU today 8-15, and, the broad market Walmart (WMT) Lead Indicator, used in concert with the sector lead indicator, was a very bullish +1.78% versus the S & P 500 (SPX) today. Also, GDX has an Elliott Wave down up down pattern the last four hours of the session, see http://finance.yahoo.com/q/ta?s=GDX&t=1d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, so, there might be a bounce early on Monday. There also obviously might be a sharp plunge at Monday's open.
The latest gold COT data for the five day period ending 8-12-08 jives with Wave A down of gold's Wave 2 Cyclical Bear Market since 3-17-08 bottoming soon, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm. The savvy non contrarian gold Commercial Traders engaged in massive short covering for the second straight week, and, for the first time in a while they entered a respectable long trade.
GDX (Gold Miners ETF) should bottom well below 8-11's cycle low at 33.86, assuming that the upcycle since 8-11 (probably peaked) was countertrend action. Since GDX has a downside gap at 32.20, 32 is a reasonable cycle low target for Wave C of the Wave A Major Intermediate Term Downcycle since mid March, which is Wave A down of the Wave 2 Cyclical Bear Market. Often important cycle highs/lows tend to occur shortly after gap filling action has been completed.
NEM created what appeared to be a bullish breakaway gap at 8-13's open at 42.36, and, GDX did so at 35.37, HUI did so at 324.45, and, the XAU did so at 140.84. They all got filled as expected today.
The GDX/HUI/XAU/GLD crash since 7-15-08 (Wave C of the Wave A Major Intermediate Term Downcycle since mid March) probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?gdx, because, there isn't a large bullish inverse spike on 8-11's candle.
Reliable lead indicator NEM has a respectably large bullish inverse spike on 8-11's candle, and, might have bottomed on 8-11, see http://stockcharts.com/charts/gallery.html?nem, and, NEM took out the cycle low that occurred in early May (which was a surprise), so, NEM is putting in/put in a Wave 2 major intermediate term cycle low, not a Wave 2 minor intermediate term cycle low.
The Wave 1 major intermediate term upcycle 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.
NEM filled downside gaps at 42.29 and 41.52 on 8-11, which is another sign that an important cycle low is probably imminent. Also, volume was an extremely high 15.335 million shares on 8-11, and, volatility has obviously been extreme as well, which are additional signs that a very important cycle low is imminent.
The NEM Lead Indicator was a modestly bullish +0.45% versus the XAU today 8-15, was a very bullish +1.48% on 8-14, was a very bearish -1.62% on 8-13, was a very bearish -1.03% 8-12, was a bullish +0.65% on 8-11, and, has been extremely bullish recently, at +1.90% on 8-8, +1.26% on 8-7, -1.82% on 8-6, -0.15% on 8-5, +2.29% on 8-4, +2.28% on 8-1, +1.08% on 7-31, -0.55% on 7-30, +0.05% on 7-29, -0.42% on 7-28, +0.12% on 7-25, +5.67% on 7-24, +0.83% on 7-23, +2.51% on 7-22, +0.71% on 7-21, +0.62% on 7-18, -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15.
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.
The US Dollar entered a Wave 3 Minor Intermediate Term Upcycle on 7-15-08, see http://stockcharts.com/charts/gallery.html?%24usd, and, entered a Cyclical Bull Market within a Secular Bear Market on 3-17-08, after putting in a cycle low at 70.698. Note the very large bullish inverse spike on 3-17-08's and 7-15-08's candle.
GDX created an upside gap at 35.87 on 8-15, NEM did so at 42.89, GLD did so at 79.35, HUI did so at 327.350, and, the XAU did so at 142.62. GLD created an upside gap at 81.13 on 8-12. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8, GDX created one at 38.92, HUI created one at 356.72, the XAU created one at 151.14, and, GLD created one at 86.09. Reliable lead indicator NEM created a downside gap at 43.75 on 8-6, and, GDX created one at 38.59, that both got filled on 8-8. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06.
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.
SPX's (S & P 500) short term Wave 3 upcycle since late July peaked in deceptive rollover mode on 8-11 (spike on 8-11's daily candle), that has an Elliott Wave 12345 up down up down up pattern (see daily chart), see the 5 day intraday candlestick chart at 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, and, see the daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24spx.
For day trading trading purposes I'll be looking at trading WMT short, or, SPX, NDX, or RUT (RUT looks like it might be the best short for Monday, see http://stockcharts.com/charts/gallery.html?%24rut) ultra short via SDS, QID, or TWM on Monday, 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. The WMT (Walmart) Lead Indicator was a very bullish +1.78% versus SPX (S & P 500) today/on 8-15.
WMT created a downside gap on 8-15 at 58.10, and, SPX has one at 1249.01 from 8-5. WMT has upside gaps at 60.76, 59.25 and SPX has one at 1305.31.
VIX fell a very sharp -3.64% today 8-15 versus SPX rising a modest +0.41%, which is a very sharp +3.23% rise in complacency (-3.64% + +0.41% = -3.23% decline in the SPX (S & P 500) wall of worry) that points to some very sharp weakness early on Monday 8-18.
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. 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 very bullish +1.78% versus SPX (S & P 500) today/on 8-15, was a slightly bearish -0.17% on 8-14, was an extremely bearish -2.02% on 8-13, was an extremely bullish +2.39% on 8-12, was a bullish +0.52% on 8-11, was a bearish -0.81% on 8-8, was an extremely bearish -4.46% on 8-7, was +0.36% on 8-6, was +0.40% on 8-5, was an extremely bullish +2.08% on 8-4, was a bearish -0.92% on 8-1, was a very bullish +1.41% on 7-31, +0.26% on 7-30, +0.21% on 7-29, +0.43% on 7-28, -0.67% on 7-25, +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, +0.39% on 7-18, +0.06% on 7-17, -0.32% on 7-16, +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) 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) 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
1:22 PM
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