Wave A Down Of The GDX/HUI/XAU Wave 2 Cyclical Bear Market Since 3-17-08 Probably Bottomed Today
Wave A down (major intermediate term downcycle since 3-17-08) of the GDX/HUI/XAU Wave 2 Cyclical Bear Market since 3-17-08 (GLD tends to lag) probably bottomed early today 9-5, see the daily candlestick chart at http://stockcharts.com/charts/gallery.html?gdx, and, see the 5 day intraday candlestick chart at http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c.
The XAU has a large bullish inverse spike on today 9-5's candle, see http://stockcharts.com/charts/gallery.html?%24xau, as does GDX (http://stockcharts.com/charts/gallery.html?gdx), HUI (http://stockcharts.com/charts/gallery.html?%24hui), and, reliable lead indicator NEM (http://stockcharts.com/charts/gallery.html?nem).
Because of index related program trading, a huge part of the market (and why sector manipulation is basically impossible), the short term cycles of many sectors (represented in the lead S & P 500 (SPX) index, http://stockcharts.com/charts/gallery.html?%24spx) are bottoming/doing/did Wave C type plunges recently.
The major averages (http://stockcharts.com/charts/gallery.html?%24spx) probably put in a monthly cycle low today, as I discuss later, and, KOL for example (Coal ETF) appears to have put in an intermediate term cycle low today, see http://stockcharts.com/charts/gallery.html?kol.
Pretty much all or nearly all sectors in the lead S & P 500 (SPX) index have been getting dumped recently, due to index related program selling. The gold sector wasn't manipulated to the downside, as some like to think (there's a lot of goofy BS in the gold sector, as many of you know), it was dumped along with nearly every, if not every, sector represented in the S & P 500 (SPX) index.
The final GDX/HUI/XAU Wave C of Wave C (since 8-28-08) downcycle appears to have bottomed today, which jives with the very bullish sector
NEM Lead Indicator today 9-5, at +1.12% versus the XAU on 9-5, and, jives with the very bullish broad market Walmart (WMT) Lead Indicator today 9-5, at
+1.17% versus the S & P 500 (SPX) on 9-5.
The five day (http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem) and the three month (http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem) sector NEM Lead Indicator are extremely bullish, which is another sign that GDX/HUI/XAU/GLD and reliable lead indicator NEM are probably very near an important cycle low (probably bottomed today 9-5).
The five day (http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) and the three month (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) broad market Walmart (WMT) Lead Indicator, used in concert with the sector NEM Lead Indicator, are extremely bullish, which is another sign that GDX/HUI/XAU/GLD and reliable lead indicator NEM are probably very near an important cycle low (probably bottomed today 9-5).
The sector NEM Lead Indicator was a very bullish +1.12% versus the XAU today/on 9-5, was a modestly bearish -0.28% versus the XAU on 9-4, -0.11% on 9-3, +1.83% on 9-2, +0.90% on 8-29, +0.19% on 8-28.
The broad market Walmart (WMT) Lead Indicator was a very bullish +1.17% versus the S & P 500 (SPX) today/on 9-5, was an extremely bullish +2.97% versus the S & P 500 (SPX) on 9-4, +0.44% on 9-3, +1.39% on 9-2, +0.02% on 8-29, -0.48% on 8-28.
Next week watch the upside gaps created at 9-2's open at 37.64 for GDX, at 45.10 for NEM (also watch 46.12), and, at 81.71 for GLD, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c. A short term Wave 1 upcycle might peak shortly after those upside gaps get filled.
It looks like Wave A down of the GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08 might have bottomed early today 9-5, during the downside gap filling action after a gap up occurred at the open, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c. The intraday NEM Lead Indicator is very bullish, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Reliable lead indicator Newmont Mining (NEM) appears to have put in a Wave 2 major intermediate term cycle low at 39 today versus the June 2007 Cyclical Bear Market cycle low at 37.84, so, NEM is in a Cyclical Bull Market since June 2007 as long as 37.84 holds.
The Wave 1 major intermediate term upcycle peaked in January at 57.44, and, NEM probably entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
The cycles for reliable lead indicator NEM and GDX/HUI/XAU/GLD are vastly different, because, NEM obviously leads. NEM is probably in a Cyclical Bull Market since the mid 2007 cycle low at 37.84. NEM's bear market from 1-31-06 until mid 2007 correctly portended the current GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08. NEM is probably in a Wave 3 major intermediate term upcycle that probably began today 9-5-08 versus GDX/HUI/XAU/GLD (GLD lags though) are probably in a countertrend Wave B major intermediate term upcycle that probably began today 9-5-08.
After bottoming at 39 early today 9-5 NEM did a Wave 1 up type move, then did a Wave 2 down type move, and, finished the session in a Wave 3 up type move, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, which suggests that there's a good chance that NEM bottomed today 9-5.
GDX/HUI/XAU also, after bottoming early today 9-5, did a Wave 1 up type move, then did a Wave 2 down type move, and, finished the session in a Wave 3 up type move, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, which suggests that there's a good chance that GDX/HUI/XAU bottomed today 9-5.
I'll be looking to day trade AEM or NEM (maybe NXG or some others, I have to look at them) long on Monday. I'll also be looking to trade RUT (Russell 2000) ultra long on Monday.
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.
There are a lot of gold/silver stocks that have been crushed (as most of you know) and will probably soon enter a Cyclical Bull Market. A few examples are CDE and NXG. I'll try to remember to point many of them out in the next few days/weeks.
One obviously wants to wait for a strong/major 5% follow through buy signal (Wave 1 monthly upcycle, or, maybe a 5% major buy signal will occur after a Wave 3 short term upcycle, or, maybe after a very strong short term Wave 1 upcycle), then look to go long after a Wave 2 monthly downcycle or maybe after a short term Wave 4 downcycle (of a monthly upcycle), or, even after short term Wave 2 downcycle, if a very strong short term Wave 1 upcycle occurred.
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.
The US Dollar hit a 5% major buy signal! (major breakout), see http://tradethecycles.blogspot.com/2008/08/us-dollar-hit-5-follow-through-major.html.
GDX created a downside gap at 36.18 on 8-21, HUI did so at 330.47, the XAU did so at 145.35, GLD did so at 77.63 (not filled yet), and, NEM did so at 43.25, ALL got filled on 9-2 except GLD, gold tends to lag. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8 (filled), GDX created one at 38.92, HUI created one at 356.72, and, GLD created one at 86.09. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06 for GLD.
SPX (S & P 500) (monthly downcycle since 8-11-08, Wave 1 monthly upcycle began on 7-15-08 and obviously peaked on 8-11-08) probably put in a Wave 2 monthly cycle low today, see http://stockcharts.com/charts/gallery.html?%24spx, and, 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. Note the large bullish inverse spike on today 9-5's candle.
I'm not going to trade SPX long, because, it failed to do the usual Elliott Wave 12345 up down up down up pattern in the Wave 1 monthly upcycle, see http://stockcharts.com/charts/gallery.html?%24spx. It has a sickly chart. This obviously means that SPX should be a good short during monthly downcycles.
RUT (Russell 2000, http://stockcharts.com/charts/gallery.html?%24rut) is probably a good long via UWM (not a recommendation, do your own due diligence), since it probably put in a monthly cycle low today 9-5. Note the very large very bullish inverse spike on today 9-5's candle. I'll look to trade RUT ultra long via UWM next week. I might hold it overnight.
The Walmart (WMT) Lead Indicator has turned extremely bullish, at +1.17% versus SPX (S & P 500) today/on 9-5, +2.97% on 9-4, +0.44% on 9-3, +1.39% on 9-2.
Waiting for a strong short term Wave 1 upcycle, then looking to go long (for holding overnight, one can obviously day trade the short term Wave 1 long) shortly after a short term Wave 2 downcycle (usually lasts about 1.5 to 3 sessions, and, does an Elliott Wave down up down pattern) bottoms is a sound strategy.
My primary (key word) trading focus now, and probably for a while, is the precious metals sector, my favorite trading sector.
Watch WMT's downside gap at 58.10 (filled 8-26) and SPX's at 1249.01 (filled 9-4). WMT has an upside gap at 60.76 (filled 9-2) and SPX has one at 1305.31.
The five day (http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) and the three month (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) Walmart (WMT) Lead Indicator are extremely bullish, which was a sign that SPX/NDX/RUT were very near an important cycle low.
VIX fell a very sharp -4.04% today 9-5 versus SPX rising a modest +0.44%, which is a very sharp +3.60% rise in complacency (-4.04% + +0.44% = -3.60% decline in the SPX (S & P 500) wall of worry) that points to some severe weakness on Monday 9-8.
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.
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 1278.60, 1305.31, 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
The XAU has a large bullish inverse spike on today 9-5's candle, see http://stockcharts.com/charts/gallery.html?%24xau, as does GDX (http://stockcharts.com/charts/gallery.html?gdx), HUI (http://stockcharts.com/charts/gallery.html?%24hui), and, reliable lead indicator NEM (http://stockcharts.com/charts/gallery.html?nem).
Because of index related program trading, a huge part of the market (and why sector manipulation is basically impossible), the short term cycles of many sectors (represented in the lead S & P 500 (SPX) index, http://stockcharts.com/charts/gallery.html?%24spx) are bottoming/doing/did Wave C type plunges recently.
The major averages (http://stockcharts.com/charts/gallery.html?%24spx) probably put in a monthly cycle low today, as I discuss later, and, KOL for example (Coal ETF) appears to have put in an intermediate term cycle low today, see http://stockcharts.com/charts/gallery.html?kol.
Pretty much all or nearly all sectors in the lead S & P 500 (SPX) index have been getting dumped recently, due to index related program selling. The gold sector wasn't manipulated to the downside, as some like to think (there's a lot of goofy BS in the gold sector, as many of you know), it was dumped along with nearly every, if not every, sector represented in the S & P 500 (SPX) index.
The final GDX/HUI/XAU Wave C of Wave C (since 8-28-08) downcycle appears to have bottomed today, which jives with the very bullish sector
NEM Lead Indicator today 9-5, at +1.12% versus the XAU on 9-5, and, jives with the very bullish broad market Walmart (WMT) Lead Indicator today 9-5, at
+1.17% versus the S & P 500 (SPX) on 9-5.
The five day (http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem) and the three month (http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem) sector NEM Lead Indicator are extremely bullish, which is another sign that GDX/HUI/XAU/GLD and reliable lead indicator NEM are probably very near an important cycle low (probably bottomed today 9-5).
The five day (http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) and the three month (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) broad market Walmart (WMT) Lead Indicator, used in concert with the sector NEM Lead Indicator, are extremely bullish, which is another sign that GDX/HUI/XAU/GLD and reliable lead indicator NEM are probably very near an important cycle low (probably bottomed today 9-5).
The sector NEM Lead Indicator was a very bullish +1.12% versus the XAU today/on 9-5, was a modestly bearish -0.28% versus the XAU on 9-4, -0.11% on 9-3, +1.83% on 9-2, +0.90% on 8-29, +0.19% on 8-28.
The broad market Walmart (WMT) Lead Indicator was a very bullish +1.17% versus the S & P 500 (SPX) today/on 9-5, was an extremely bullish +2.97% versus the S & P 500 (SPX) on 9-4, +0.44% on 9-3, +1.39% on 9-2, +0.02% on 8-29, -0.48% on 8-28.
Next week watch the upside gaps created at 9-2's open at 37.64 for GDX, at 45.10 for NEM (also watch 46.12), and, at 81.71 for GLD, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c. A short term Wave 1 upcycle might peak shortly after those upside gaps get filled.
It looks like Wave A down of the GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08 might have bottomed early today 9-5, during the downside gap filling action after a gap up occurred at the open, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c. The intraday NEM Lead Indicator is very bullish, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Reliable lead indicator Newmont Mining (NEM) appears to have put in a Wave 2 major intermediate term cycle low at 39 today versus the June 2007 Cyclical Bear Market cycle low at 37.84, so, NEM is in a Cyclical Bull Market since June 2007 as long as 37.84 holds.
The Wave 1 major intermediate term upcycle peaked in January at 57.44, and, NEM probably entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
The cycles for reliable lead indicator NEM and GDX/HUI/XAU/GLD are vastly different, because, NEM obviously leads. NEM is probably in a Cyclical Bull Market since the mid 2007 cycle low at 37.84. NEM's bear market from 1-31-06 until mid 2007 correctly portended the current GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08. NEM is probably in a Wave 3 major intermediate term upcycle that probably began today 9-5-08 versus GDX/HUI/XAU/GLD (GLD lags though) are probably in a countertrend Wave B major intermediate term upcycle that probably began today 9-5-08.
After bottoming at 39 early today 9-5 NEM did a Wave 1 up type move, then did a Wave 2 down type move, and, finished the session in a Wave 3 up type move, see http://finance.yahoo.com/q/ta?s=nem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, which suggests that there's a good chance that NEM bottomed today 9-5.
GDX/HUI/XAU also, after bottoming early today 9-5, did a Wave 1 up type move, then did a Wave 2 down type move, and, finished the session in a Wave 3 up type move, see http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, which suggests that there's a good chance that GDX/HUI/XAU bottomed today 9-5.
I'll be looking to day trade AEM or NEM (maybe NXG or some others, I have to look at them) long on Monday. I'll also be looking to trade RUT (Russell 2000) ultra long on Monday.
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.
There are a lot of gold/silver stocks that have been crushed (as most of you know) and will probably soon enter a Cyclical Bull Market. A few examples are CDE and NXG. I'll try to remember to point many of them out in the next few days/weeks.
One obviously wants to wait for a strong/major 5% follow through buy signal (Wave 1 monthly upcycle, or, maybe a 5% major buy signal will occur after a Wave 3 short term upcycle, or, maybe after a very strong short term Wave 1 upcycle), then look to go long after a Wave 2 monthly downcycle or maybe after a short term Wave 4 downcycle (of a monthly upcycle), or, even after short term Wave 2 downcycle, if a very strong short term Wave 1 upcycle occurred.
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.
The US Dollar hit a 5% major buy signal! (major breakout), see http://tradethecycles.blogspot.com/2008/08/us-dollar-hit-5-follow-through-major.html.
GDX created a downside gap at 36.18 on 8-21, HUI did so at 330.47, the XAU did so at 145.35, GLD did so at 77.63 (not filled yet), and, NEM did so at 43.25, ALL got filled on 9-2 except GLD, gold tends to lag. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8 (filled), GDX created one at 38.92, HUI created one at 356.72, and, GLD created one at 86.09. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06 for GLD.
SPX (S & P 500) (monthly downcycle since 8-11-08, Wave 1 monthly upcycle began on 7-15-08 and obviously peaked on 8-11-08) probably put in a Wave 2 monthly cycle low today, see http://stockcharts.com/charts/gallery.html?%24spx, and, 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. Note the large bullish inverse spike on today 9-5's candle.
I'm not going to trade SPX long, because, it failed to do the usual Elliott Wave 12345 up down up down up pattern in the Wave 1 monthly upcycle, see http://stockcharts.com/charts/gallery.html?%24spx. It has a sickly chart. This obviously means that SPX should be a good short during monthly downcycles.
RUT (Russell 2000, http://stockcharts.com/charts/gallery.html?%24rut) is probably a good long via UWM (not a recommendation, do your own due diligence), since it probably put in a monthly cycle low today 9-5. Note the very large very bullish inverse spike on today 9-5's candle. I'll look to trade RUT ultra long via UWM next week. I might hold it overnight.
The Walmart (WMT) Lead Indicator has turned extremely bullish, at +1.17% versus SPX (S & P 500) today/on 9-5, +2.97% on 9-4, +0.44% on 9-3, +1.39% on 9-2.
Waiting for a strong short term Wave 1 upcycle, then looking to go long (for holding overnight, one can obviously day trade the short term Wave 1 long) shortly after a short term Wave 2 downcycle (usually lasts about 1.5 to 3 sessions, and, does an Elliott Wave down up down pattern) bottoms is a sound strategy.
My primary (key word) trading focus now, and probably for a while, is the precious metals sector, my favorite trading sector.
Watch WMT's downside gap at 58.10 (filled 8-26) and SPX's at 1249.01 (filled 9-4). WMT has an upside gap at 60.76 (filled 9-2) and SPX has one at 1305.31.
The five day (http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) and the three month (http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC) Walmart (WMT) Lead Indicator are extremely bullish, which was a sign that SPX/NDX/RUT were very near an important cycle low.
VIX fell a very sharp -4.04% today 9-5 versus SPX rising a modest +0.44%, which is a very sharp +3.60% rise in complacency (-4.04% + +0.44% = -3.60% decline in the SPX (S & P 500) wall of worry) that points to some severe weakness on Monday 9-8.
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.
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 1278.60, 1305.31, 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, XAU
posted by Joe Ferrazzano at
9:34 AM
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