GDX/HUI/XAU Confirmed The Likely Bullish Scenario Today
GDX/HUI/XAU confirmed the likely bullish scenario today 1-16, see GDX (Gold Miners ETF) at http://finance.yahoo.com/q/ta?s=gdx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, experiencing very sharp gains, and, the XAU has a bullish large inverse spike on both yesterday 1-15's and today 1-16's candle, see http://stockcharts.com/charts/gallery.html?%24xau.
Since mid session yesterday 1-15 GDX/HUI/XAU have done a monster short term Wave 1 upcycle, of the Wave 5 monthly upcycle that began mid session yesterday 1-15. They ended the session in the final Wave 5 up of the short term Wave 1 upcycle.
It looks like they'll peak early on Tuesday, and, GDX will probably fill today's downside gap at 29.13 on Tuesday or Wednesday in the short term Wave 2 downcycle, after which I'll look to day trade and possibly overnight trade GDX.
The reliable gold/silver sector NEM Lead Indicator was an extremely bearish -2.75% versus the XAU today/on 1-16, which points to early strength followed by severe weakness on Tuesday.
The NEM Lead Indicator was a slightly bullish +0.25% versus the XAU yesterday/on 1-15, it was +3.66% on 1-14, -2.41% on 1-13, +3.59% on 1-12, +0.57% on 1-9, +2.02% on 1-8.
GDX/HUI/XAU appear to have put in a Wave 4 monthly cycle low yesterday 1-15-09, see http://stockcharts.com/charts/gallery.html?%24xau, with GDX/HUI/XAU doing an inverse Elliott Wave 12345 down up down up down pattern since 1-2-09's GDX/XAU Wave 3 monthly cycle high (HUI on 12-17-08). Note the bullish large inverse spike on a bullish white (close above the open) candle.
A GDX/HUI/XAU Wave 5 monthly upcycle probably began yesterday 1-15, that should rock to the upside. GDX/HUI/XAU's strength since the Wave 3 Cyclical Bull Market probably began in late October 2008 has been very impressive, and, Wave 5s tend to be the strongest upcycle.
An upcycle's strength tends to peak near or at a Wave 5 cycle high, and, Wave 5s tend to be stronger (% gain per session, Wave 3s tend to be longer in duration) than Wave 3s or Wave 1s.
Reliable gold/silver sector lead indicator NEM probably put in a Wave 2 monthly cycle low yesterday 1-15, see http://stockcharts.com/charts/gallery.html?nem.
SRS (UltraShort Real Estate ETF, http://stockcharts.com/charts/gallery.html?srs) has a downside gap at 58.36, that looks like it'll get filled early on Tuesday 1-20, because, since early yesterday 1-15 it appears to be doing an inverse Elliott Wave 12345 down up down up down pattern, see http://finance.yahoo.com/q/ta?s=srs&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
SRS (UltraShort Real Estate ETF, http://stockcharts.com/charts/gallery.html?srs) ended today 1-16 in the final Wave 5 down of the inverse Elliott Wave 12345 downcycle that began yesterday 1-15. This is my likely (day) trade on Tuesday 1-20, and, there might be a good entry point very early on.
Today's SPX (S & P 500) rebound after early weakness appears to be countertrend Wave B type action, so, a test of yesterday 1-15's likely short term Wave 4 cycle low appears likely, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
SPX (S & P 500) probably put in a short term Wave A, or, more likely I now think, it's a short term Wave 4 (since 1-6-09) cycle low yesterday 1-15, see http://stockcharts.com/charts/gallery.html?%24spx.
I say that it's probably an SPX (S & P 500) short term Wave 4 (since 1-6-09) cycle low, because, I now think that the cycle high at 943.85 on 1-6-09 is really a short term Wave 3 cycle high.
For one thing, 1-6-09's SPX (S & P 500) candle would be atypical for an important countertrend Wave B (since mid/late November 2008) minor intermediate term cycle high, see http://stockcharts.com/charts/gallery.html?%24spx. Normally, there's a large spike for an intermediate term or even a short term cycle high.
Also, looking at the SPX (S & P 500) Elliott Wave count again it looks like the cycle high at 943.85 on 1-6-09 is really a short term Wave 3 cycle high. From the short term Wave 2 cycle low at 815.69, until 1-6-09's likely short term Wave 3 cycle high at 943.85, a very anemic (long) short term Wave 3 upcycle occurred, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) could have a surprisingly strong short term Wave 5 upcycle (Wave 5s tend to be the strongest), although, it also might be a short term countertrend Wave B upcycle. If so, then broad market lead indicator Walmart (WMT) will have to make a good attempt at filling it's huge upside gap created on 1-8 at 55.54, see http://stockcharts.com/charts/gallery.html?wmt. WMT does have a bullish large inverse spike on 1-15's candle.
The extremely bullish broad market Walmart (WMT) Lead Indicator jives with the above analysis, at -0.35% versus SPX (S & P 500) today/on 1-16, -0.54% on 1-15, +2.28% on 1-14, +1.24% on 1-13, +1.89% on 1-12, +2.52% on 1-9.
The SPX (S & P 500) Volatility Index VIX reveals an unusually large rise in complacency today (-9.59%), relative to the significant SPX gain of +0.76%, which is an unusually large +8.83% rise in complacency/-8.83% decline in the SPX wall of worry, that usually would point to significant SPX strength early on Tuesday, but, weakness appears likely.
SPX (S & P 500) has been in a Cyclical Bear Market since 10-11-07, NDX (NASDAQ 100) has been in a Cyclical Bear Market since very late October 2007, and, RUT (Russell 2000) has been in a Cyclical Bear Market since July 2007.
The XOM Lead Indicator was a modestly bullish +0.32% versus the XOI (AMEX Oil and Gas) today/on 1-16, it was +1.55% on 1-15, it was +0.63% on 1-14, +0.31% on 1-13, +1.84% on 1-12, +1.33% on 1-9.
In the near future I also plan to start trading an income type ETF short term (a few days or just overnight). Some income type ETFs are as volatile as rockets (COY, EAD, PHK, HYG, JNK, etc). A reader suggested TLT (20 Year Treasury ETF, http://stockcharts.com/charts/gallery.html?tlt, yield right now is about 3.50%, as best as I can tell based on a very quick look at Yahoo's info) a few months ago, which is a definite possibility, and, is one of the safer, more calm, low volatility income type ETF s.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
NEM created a bearish breakaway upside gap at 37.04 at 1-12's open (filled on 1-15), one at 39.55 at 1-7's open, and, one at 40.33 at 1-5's open. GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 28.67 (it got filled 1-13), 25.41, and 23.23. GDX created an upside gap at 33.32 at 1-5's open, that's a bearish breakaway upside gap, and, created ones on 1-7 at 32.61 and on 1-12 at 31.31.
GDX/HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) hit a 5% follow through major buy signal on Wednesday 12-10-08 (see annotated chart one at http://www.joefrocks.com/GoldStockCharts.html), breaking the multi month Wave 2 Cyclical Bear Market downtrend line since mid March 2008 by more than 5%, see HUI at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, and, see the XAU (the major breakout is more obvious in the XAU's chart) at http://finance.yahoo.com/q/ta?s=%5Exau&t=6m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=, which means that they very likely entered a Wave 3 Cyclical Bull Market in late October 2008. Note that HUI has a very bullish triple bottom in late October 2008. Trade the Cycles is now obviously on a buy signal for GDX/HUI/XAU.
Keep in mind/major warning that, not all gold/silver stocks have the same cycles. They can be vastly different. CDE (Coeur D' Alene Mines) has/had a bear market from/since 2004 for example, see http://finance.yahoo.com/q/ta?s=cde&t=my&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. Harmony Gold (HMY) is another stock that's been in a bear market since 2002, see http://finance.yahoo.com/q/ta?s=hmy&t=my&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
Since this is a Wave 3 HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) Cyclical Bull Market, it's likely to be a great one, since Wave 3 upcycles tend to be considerably larger than Wave 1 upcycles.
The gold/silver stock apocalypse since May 2006 (reliable gold sector lead indicator NEM since 1-31-06 and GDX/HUI/XAU since mid March 2008) is probably finally over for many/most gold/silver stocks, see the XAU's daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24xau, and, see reliable gold sector lead indicator NEM's daily candlestick chart at http://stockcharts.com/charts/gallery.html?nem. Reliable gold sector lead indicator NEM put in a bullish double bottom in late October/late November 2008 at 21.40/21.17.
It'll take time to inflate the world out of this deflationary mess/credit crisis. Yes, gold might hit $2000+ in about 10 years, but, it might hit $350-$400 next year, when it finally bottoms. Remember that HUI/XAU bottomed in late 2000, whereas, gold bottomed in April 2001 and silver didn't bottom until late 2001. The metals LAG.
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
Since mid session yesterday 1-15 GDX/HUI/XAU have done a monster short term Wave 1 upcycle, of the Wave 5 monthly upcycle that began mid session yesterday 1-15. They ended the session in the final Wave 5 up of the short term Wave 1 upcycle.
It looks like they'll peak early on Tuesday, and, GDX will probably fill today's downside gap at 29.13 on Tuesday or Wednesday in the short term Wave 2 downcycle, after which I'll look to day trade and possibly overnight trade GDX.
The reliable gold/silver sector NEM Lead Indicator was an extremely bearish -2.75% versus the XAU today/on 1-16, which points to early strength followed by severe weakness on Tuesday.
The NEM Lead Indicator was a slightly bullish +0.25% versus the XAU yesterday/on 1-15, it was +3.66% on 1-14, -2.41% on 1-13, +3.59% on 1-12, +0.57% on 1-9, +2.02% on 1-8.
GDX/HUI/XAU appear to have put in a Wave 4 monthly cycle low yesterday 1-15-09, see http://stockcharts.com/charts/gallery.html?%24xau, with GDX/HUI/XAU doing an inverse Elliott Wave 12345 down up down up down pattern since 1-2-09's GDX/XAU Wave 3 monthly cycle high (HUI on 12-17-08). Note the bullish large inverse spike on a bullish white (close above the open) candle.
A GDX/HUI/XAU Wave 5 monthly upcycle probably began yesterday 1-15, that should rock to the upside. GDX/HUI/XAU's strength since the Wave 3 Cyclical Bull Market probably began in late October 2008 has been very impressive, and, Wave 5s tend to be the strongest upcycle.
An upcycle's strength tends to peak near or at a Wave 5 cycle high, and, Wave 5s tend to be stronger (% gain per session, Wave 3s tend to be longer in duration) than Wave 3s or Wave 1s.
Reliable gold/silver sector lead indicator NEM probably put in a Wave 2 monthly cycle low yesterday 1-15, see http://stockcharts.com/charts/gallery.html?nem.
SRS (UltraShort Real Estate ETF, http://stockcharts.com/charts/gallery.html?srs) has a downside gap at 58.36, that looks like it'll get filled early on Tuesday 1-20, because, since early yesterday 1-15 it appears to be doing an inverse Elliott Wave 12345 down up down up down pattern, see http://finance.yahoo.com/q/ta?s=srs&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
SRS (UltraShort Real Estate ETF, http://stockcharts.com/charts/gallery.html?srs) ended today 1-16 in the final Wave 5 down of the inverse Elliott Wave 12345 downcycle that began yesterday 1-15. This is my likely (day) trade on Tuesday 1-20, and, there might be a good entry point very early on.
Today's SPX (S & P 500) rebound after early weakness appears to be countertrend Wave B type action, so, a test of yesterday 1-15's likely short term Wave 4 cycle low appears likely, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=.
SPX (S & P 500) probably put in a short term Wave A, or, more likely I now think, it's a short term Wave 4 (since 1-6-09) cycle low yesterday 1-15, see http://stockcharts.com/charts/gallery.html?%24spx.
I say that it's probably an SPX (S & P 500) short term Wave 4 (since 1-6-09) cycle low, because, I now think that the cycle high at 943.85 on 1-6-09 is really a short term Wave 3 cycle high.
For one thing, 1-6-09's SPX (S & P 500) candle would be atypical for an important countertrend Wave B (since mid/late November 2008) minor intermediate term cycle high, see http://stockcharts.com/charts/gallery.html?%24spx. Normally, there's a large spike for an intermediate term or even a short term cycle high.
Also, looking at the SPX (S & P 500) Elliott Wave count again it looks like the cycle high at 943.85 on 1-6-09 is really a short term Wave 3 cycle high. From the short term Wave 2 cycle low at 815.69, until 1-6-09's likely short term Wave 3 cycle high at 943.85, a very anemic (long) short term Wave 3 upcycle occurred, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) could have a surprisingly strong short term Wave 5 upcycle (Wave 5s tend to be the strongest), although, it also might be a short term countertrend Wave B upcycle. If so, then broad market lead indicator Walmart (WMT) will have to make a good attempt at filling it's huge upside gap created on 1-8 at 55.54, see http://stockcharts.com/charts/gallery.html?wmt. WMT does have a bullish large inverse spike on 1-15's candle.
The extremely bullish broad market Walmart (WMT) Lead Indicator jives with the above analysis, at -0.35% versus SPX (S & P 500) today/on 1-16, -0.54% on 1-15, +2.28% on 1-14, +1.24% on 1-13, +1.89% on 1-12, +2.52% on 1-9.
The SPX (S & P 500) Volatility Index VIX reveals an unusually large rise in complacency today (-9.59%), relative to the significant SPX gain of +0.76%, which is an unusually large +8.83% rise in complacency/-8.83% decline in the SPX wall of worry, that usually would point to significant SPX strength early on Tuesday, but, weakness appears likely.
SPX (S & P 500) has been in a Cyclical Bear Market since 10-11-07, NDX (NASDAQ 100) has been in a Cyclical Bear Market since very late October 2007, and, RUT (Russell 2000) has been in a Cyclical Bear Market since July 2007.
The XOM Lead Indicator was a modestly bullish +0.32% versus the XOI (AMEX Oil and Gas) today/on 1-16, it was +1.55% on 1-15, it was +0.63% on 1-14, +0.31% on 1-13, +1.84% on 1-12, +1.33% on 1-9.
In the near future I also plan to start trading an income type ETF short term (a few days or just overnight). Some income type ETFs are as volatile as rockets (COY, EAD, PHK, HYG, JNK, etc). A reader suggested TLT (20 Year Treasury ETF, http://stockcharts.com/charts/gallery.html?tlt, yield right now is about 3.50%, as best as I can tell based on a very quick look at Yahoo's info) a few months ago, which is a definite possibility, and, is one of the safer, more calm, low volatility income type ETF s.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
NEM created a bearish breakaway upside gap at 37.04 at 1-12's open (filled on 1-15), one at 39.55 at 1-7's open, and, one at 40.33 at 1-5's open. GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 28.67 (it got filled 1-13), 25.41, and 23.23. GDX created an upside gap at 33.32 at 1-5's open, that's a bearish breakaway upside gap, and, created ones on 1-7 at 32.61 and on 1-12 at 31.31.
GDX/HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) hit a 5% follow through major buy signal on Wednesday 12-10-08 (see annotated chart one at http://www.joefrocks.com/GoldStockCharts.html), breaking the multi month Wave 2 Cyclical Bear Market downtrend line since mid March 2008 by more than 5%, see HUI at http://finance.yahoo.com/q/ta?s=%5EHUI&t=6m&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, and, see the XAU (the major breakout is more obvious in the XAU's chart) at http://finance.yahoo.com/q/ta?s=%5Exau&t=6m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=, which means that they very likely entered a Wave 3 Cyclical Bull Market in late October 2008. Note that HUI has a very bullish triple bottom in late October 2008. Trade the Cycles is now obviously on a buy signal for GDX/HUI/XAU.
Keep in mind/major warning that, not all gold/silver stocks have the same cycles. They can be vastly different. CDE (Coeur D' Alene Mines) has/had a bear market from/since 2004 for example, see http://finance.yahoo.com/q/ta?s=cde&t=my&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. Harmony Gold (HMY) is another stock that's been in a bear market since 2002, see http://finance.yahoo.com/q/ta?s=hmy&t=my&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
Since this is a Wave 3 HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) Cyclical Bull Market, it's likely to be a great one, since Wave 3 upcycles tend to be considerably larger than Wave 1 upcycles.
The gold/silver stock apocalypse since May 2006 (reliable gold sector lead indicator NEM since 1-31-06 and GDX/HUI/XAU since mid March 2008) is probably finally over for many/most gold/silver stocks, see the XAU's daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24xau, and, see reliable gold sector lead indicator NEM's daily candlestick chart at http://stockcharts.com/charts/gallery.html?nem. Reliable gold sector lead indicator NEM put in a bullish double bottom in late October/late November 2008 at 21.40/21.17.
It'll take time to inflate the world out of this deflationary mess/credit crisis. Yes, gold might hit $2000+ in about 10 years, but, it might hit $350-$400 next year, when it finally bottoms. Remember that HUI/XAU bottomed in late 2000, whereas, gold bottomed in April 2001 and silver didn't bottom until late 2001. The metals LAG.
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: DUG, GDX, Gold, Gold Stocks, HUI, NDX, NEM, RUT, Silver, Silver Stocks, SPX, XAU, XOI, XOM
posted by Joe Ferrazzano at
2:07 PM
3 Comments:
hi joe,
in my count we ve already done the short term wave1of5, hui corrected 5% to2, and now we re in a sub wave3of5. any comments?
By
primaprova, at 2:08 AM
Hi primaprova,
GDX/HUI/XAU have done an up down up down pattern on the intraday chart since 1-15-09, and, are in Wave 5 up since mid session 1-16-09, of the short term Wave 1 upcycle, of the Wave 5 monthly upcycle that began on 1-15-09.
By
Joe Ferrazzano, at 2:11 PM
i see your point, but in this case we'd have a wave5 already longer than w3, that s also longer than w1. that d be a rule violation by which w3 cannot be the shorter, isnt it? do i miss something?
By
primaprova, at 2:45 PM
Post a Comment
<< Home