Today's GDX/HUI/XAU Early Spike Move is still the countertrend Wave B Upcycle of the Short Term Wave 2 Downcycle
Today's GDX/HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) early spike move, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, is probably the countertrend Wave B upcycle of the short term Wave 2 downcycle since 11-5-08, not a short term Wave 3 upcycle. The large early spike was probably the Wave 3 of Wave B of Wave 2 cycle high (GDX's early cycle high was 23.71).
GDX/HUI/XAU made a large "bullish" breakaway type gap up at today 11-10's open, however, today's downside gaps (21.75 for GDX, 26.02 for NEM) should get filled in the next few days, in Wave C of the short term Wave 2 downcycle since 11-5-08, along with 20.95 and maybe 18.69 for GDX.
GDX's countertrend Wave B upcycle of the short term Wave 2 downcycle since 11-5-08 should peak at 24+, assuming that it didn't already peak at 23.71, which looks like Wave 3 of Wave B of Wave 2. Today's bordering on very bullish NEM Lead Indicator (+0.97% versus the XAU on 11-10) suggests that Wave B of Wave 2 didn't peak yet.
SPX's (S & P 500) early cycle high (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=) today appears to be the countertrend Wave B cycle high of the short term Wave C downcycle since 11-5-08, looking at today's bearish black candle (close below the open) and medium bearish spike, see http://stockcharts.com/charts/gallery.html?%24spx.
The XOI (AMEX Oil and Gas) also appears to have put in a countertrend Wave B type cycle high early today, see http://stockcharts.com/charts/gallery.html?%24xoi and see http://finance.yahoo.com/q/ta?s=%5Exoi&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
Tomorrow I'll look at either (day trade, and maybe hold a modest position overnight) shorting GDX, ultra shorting the major averages via SDS/QID/TWM, or, ultra shorting the XOI (AMEX Oil and Gas) via DUG. Nothing I discuss on this Blog is a recommendation.
Looking at the intraday charts, 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=, it looks like there might be strength in the first hour or two tomorrow, after which I'll look to day trade short.
An SPX short term Wave C downcycle began on 11-5-08, see http://stockcharts.com/charts/gallery.html?%24spx, in which SPX (S & P 500) should take out it's cycle low at 839.80 that occurred on 10-10-08, confirming that SPX and most other indexes/sectors remain in a Cyclical Bear Market.
The gold stock sector (GDX/HUI/XAU) is one sector that clearly APPEARS to have bottomed, see http://stockcharts.com/charts/gallery.html?%24hui. HUI has a nice very bullish triple bottom. Reliable lead indicator NEM recently put in a nice bullish double bottom at 21.40/21.47, see http://stockcharts.com/charts/gallery.html?nem. Waiting for a 5% major buy signal makes a lot of sense obviously.
The gold sector NEM Lead Indicator the past three weeks is super bearish (maybe that's actually a very bullish sign, and, the sector might have finally bottomed and defied gravity), at a bullish +0.97% versus the XAU today/on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27, -2.08% on 10-24, -0.85% on 10-23.
In the next few days to a week, SPX/NDX/RUT and most other indexes/sectors will probably take out their recent lows (10-10-08 for SPX and the XOI). The lead indicators jive with severe weakness (began 11-5-08), for most sectors/indexes.
The 5 day intraday broad market Walmart (WMT) Lead Indicator is extremely bullish (which is very short term bearish, +2.72% versus SPX today/on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5, -3.79% on 11-4, +0.54% on 11-3, +0.40% on 10-31, -3.07% on 10-30, +0.84% on 10-29, +0.28% on 10-28, -0.19% on 10-27), see 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.
The 5 day intraday gold sector NEM Lead Indicator is extremely bearish (which is very short term bullish, +0.97% versus the XAU today/on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The 5 day intraday oil and gas sector XOM (Exxon Mobil) Lead Indicator is extremely bearish (which is very short term bullish, -0.53% versus the XOI today/on 11-10, +0.65% on 11-7, +0.44% on 11-6, -0.23% on 11-5, -2.49% on 11-4, +2.41% on 11-3, -3.01% on 10-31, -3.26% on 10-30, -3.62% on 10-29, -0.45% on 10-28, +1.46% on 10-27), see http://finance.yahoo.com/q/ta?t=5d&s=%5EXOI&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=xom.
The GDX/HUI/XAU Wave 2 Cyclical Bear Market since mid March is probably/appears to be over (don't be shocked if it isn't), see http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI/XAU still need to hit a 5% major buy signal however, before Trade the Cycles indicates that they've very likely bottomed. This still could end up being the mother of all headfakes. Also, gold very likely hasn't bottomed.
Gold (http://stockcharts.com/charts/gallery.html?gld) lags GDX/HUI/XAU, and, will probably bottom at $500ish, maybe $450 or even lower.
Reliable gold sector lead indicator Newmont Mining (NEM) shot up a spectacular +22.89% on 10-28-08, see http://stockcharts.com/charts/gallery.html?nem.
It LOOKS LIKE (it obviously makes a LOT of sense to wait for a 5% follow through major buy signal) NEM PROBABLY put in a Wave 2 Cyclical Bear Market (since 1-31-06) cycle low just before 10-27's close at 21.40, which is a bullish double bottom cycle low with the previous session's cycle low at 21.47.
The GDX/HUI/XAU Wave 3 Cyclical Bull Market (might not have started yet) is likely to be a great one. Wave 3 upcycles tend to be large, relative to Wave 1 upcycles.
SPX (S & P 500) and the XOI (AMEX Oil & Gas) are probably still in a Cyclical Bear Market, see SPX at http://stockcharts.com/charts/gallery.html?%24spx, and, see the XOI at http://stockcharts.com/charts/gallery.html?%24xoi. Since cycle lows keep failing, one has to assume that's the case. SPX put in lower cycle lows in five consecutive sessions recently.
The NASDAQ 100 (NDX) is probably still in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?%24ndx, as are RUT (Russell 2000, might have bottomed, doubtful), see http://stockcharts.com/charts/gallery.html?%24rut, and, GDX/HUI/XAU might still be in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?gdx.
A Cyclical Bear Market 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).
Please keep in mind that, after an index puts in a potential major cycle low, it has to hit a 5% follow through (after breaking the major downcycle trendline) major buy signal before the Trade the Cycles system indicates that a major cycle low has very likely occurred.
My original Trade the Cycles system uses the reliable Elliott Wave patterns (see the Trade the Cycles charts at http://www.joefrocks.com/GoldStockCharts.html) and maps them to cycles of various timeframes (an Elliott Wave is either an upcycle or a downcycle), from very short term (hours/days), short term (days/weeks), monthly (4-7 weeks), minor intermediate term (2-3 months), major intermediate term (3-12 months), long term (1 to 2 years), Cyclical Bull/Bear Market (6 months to 7 years, yes, a bull/bear can be relatively brief), Secular Bull/Bear Market (8-20+ years).
Gaps are very important also, since most gaps get filled and they often provide insight into when cycle highs/lows will occur.
.......http://www.JoeFRocks.com/
NEM XAU HUI
GDX/HUI/XAU made a large "bullish" breakaway type gap up at today 11-10's open, however, today's downside gaps (21.75 for GDX, 26.02 for NEM) should get filled in the next few days, in Wave C of the short term Wave 2 downcycle since 11-5-08, along with 20.95 and maybe 18.69 for GDX.
GDX's countertrend Wave B upcycle of the short term Wave 2 downcycle since 11-5-08 should peak at 24+, assuming that it didn't already peak at 23.71, which looks like Wave 3 of Wave B of Wave 2. Today's bordering on very bullish NEM Lead Indicator (+0.97% versus the XAU on 11-10) suggests that Wave B of Wave 2 didn't peak yet.
SPX's (S & P 500) early cycle high (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=) today appears to be the countertrend Wave B cycle high of the short term Wave C downcycle since 11-5-08, looking at today's bearish black candle (close below the open) and medium bearish spike, see http://stockcharts.com/charts/gallery.html?%24spx.
The XOI (AMEX Oil and Gas) also appears to have put in a countertrend Wave B type cycle high early today, see http://stockcharts.com/charts/gallery.html?%24xoi and see http://finance.yahoo.com/q/ta?s=%5Exoi&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
Tomorrow I'll look at either (day trade, and maybe hold a modest position overnight) shorting GDX, ultra shorting the major averages via SDS/QID/TWM, or, ultra shorting the XOI (AMEX Oil and Gas) via DUG. Nothing I discuss on this Blog is a recommendation.
Looking at the intraday charts, 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=, it looks like there might be strength in the first hour or two tomorrow, after which I'll look to day trade short.
An SPX short term Wave C downcycle began on 11-5-08, see http://stockcharts.com/charts/gallery.html?%24spx, in which SPX (S & P 500) should take out it's cycle low at 839.80 that occurred on 10-10-08, confirming that SPX and most other indexes/sectors remain in a Cyclical Bear Market.
The gold stock sector (GDX/HUI/XAU) is one sector that clearly APPEARS to have bottomed, see http://stockcharts.com/charts/gallery.html?%24hui. HUI has a nice very bullish triple bottom. Reliable lead indicator NEM recently put in a nice bullish double bottom at 21.40/21.47, see http://stockcharts.com/charts/gallery.html?nem. Waiting for a 5% major buy signal makes a lot of sense obviously.
The gold sector NEM Lead Indicator the past three weeks is super bearish (maybe that's actually a very bullish sign, and, the sector might have finally bottomed and defied gravity), at a bullish +0.97% versus the XAU today/on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27, -2.08% on 10-24, -0.85% on 10-23.
In the next few days to a week, SPX/NDX/RUT and most other indexes/sectors will probably take out their recent lows (10-10-08 for SPX and the XOI). The lead indicators jive with severe weakness (began 11-5-08), for most sectors/indexes.
The 5 day intraday broad market Walmart (WMT) Lead Indicator is extremely bullish (which is very short term bearish, +2.72% versus SPX today/on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5, -3.79% on 11-4, +0.54% on 11-3, +0.40% on 10-31, -3.07% on 10-30, +0.84% on 10-29, +0.28% on 10-28, -0.19% on 10-27), see 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.
The 5 day intraday gold sector NEM Lead Indicator is extremely bearish (which is very short term bullish, +0.97% versus the XAU today/on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The 5 day intraday oil and gas sector XOM (Exxon Mobil) Lead Indicator is extremely bearish (which is very short term bullish, -0.53% versus the XOI today/on 11-10, +0.65% on 11-7, +0.44% on 11-6, -0.23% on 11-5, -2.49% on 11-4, +2.41% on 11-3, -3.01% on 10-31, -3.26% on 10-30, -3.62% on 10-29, -0.45% on 10-28, +1.46% on 10-27), see http://finance.yahoo.com/q/ta?t=5d&s=%5EXOI&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=xom.
The GDX/HUI/XAU Wave 2 Cyclical Bear Market since mid March is probably/appears to be over (don't be shocked if it isn't), see http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI/XAU still need to hit a 5% major buy signal however, before Trade the Cycles indicates that they've very likely bottomed. This still could end up being the mother of all headfakes. Also, gold very likely hasn't bottomed.
Gold (http://stockcharts.com/charts/gallery.html?gld) lags GDX/HUI/XAU, and, will probably bottom at $500ish, maybe $450 or even lower.
Reliable gold sector lead indicator Newmont Mining (NEM) shot up a spectacular +22.89% on 10-28-08, see http://stockcharts.com/charts/gallery.html?nem.
It LOOKS LIKE (it obviously makes a LOT of sense to wait for a 5% follow through major buy signal) NEM PROBABLY put in a Wave 2 Cyclical Bear Market (since 1-31-06) cycle low just before 10-27's close at 21.40, which is a bullish double bottom cycle low with the previous session's cycle low at 21.47.
The GDX/HUI/XAU Wave 3 Cyclical Bull Market (might not have started yet) is likely to be a great one. Wave 3 upcycles tend to be large, relative to Wave 1 upcycles.
SPX (S & P 500) and the XOI (AMEX Oil & Gas) are probably still in a Cyclical Bear Market, see SPX at http://stockcharts.com/charts/gallery.html?%24spx, and, see the XOI at http://stockcharts.com/charts/gallery.html?%24xoi. Since cycle lows keep failing, one has to assume that's the case. SPX put in lower cycle lows in five consecutive sessions recently.
The NASDAQ 100 (NDX) is probably still in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?%24ndx, as are RUT (Russell 2000, might have bottomed, doubtful), see http://stockcharts.com/charts/gallery.html?%24rut, and, GDX/HUI/XAU might still be in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?gdx.
A Cyclical Bear Market 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).
Please keep in mind that, after an index puts in a potential major cycle low, it has to hit a 5% follow through (after breaking the major downcycle trendline) major buy signal before the Trade the Cycles system indicates that a major cycle low has very likely occurred.
My original Trade the Cycles system uses the reliable Elliott Wave patterns (see the Trade the Cycles charts at http://www.joefrocks.com/GoldStockCharts.html) and maps them to cycles of various timeframes (an Elliott Wave is either an upcycle or a downcycle), from very short term (hours/days), short term (days/weeks), monthly (4-7 weeks), minor intermediate term (2-3 months), major intermediate term (3-12 months), long term (1 to 2 years), Cyclical Bull/Bear Market (6 months to 7 years, yes, a bull/bear can be relatively brief), Secular Bull/Bear Market (8-20+ years).
Gaps are very important also, since most gaps get filled and they often provide insight into when cycle highs/lows will occur.
.......http://www.JoeFRocks.com/
NEM XAU HUI
Labels: GDX, Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, XAU
posted by Joe Ferrazzano at
7:26 AM
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