SPX's (S & P 500) Very Short Term Countertrend Wave 4 Upcycle Appears To Have Peaked
SPX's (S & P 500) very short term countertrend Wave 4 upcycle since 3-6-09 appears to have peaked, see http://stockcharts.com/charts/gallery.html?%24spx. Note that SPX (S & P 500) has a medium bearish spike on a bearish black (close below the open) candle today 3-11-09.
If one looks at the second weekly view chart (at http://stockcharts.com/charts/gallery.html?%24spx) one can see that SPX (S & P 500) probably didn't bottom yet/on 3-6-09, because, the inverse spike is too small/not bullish enough, and, the candle is red/bearish, indicating a weekly close below the weekly open.
Looking at SPX's (S & P 500) five day intraday chart, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, one can see that SPX's (S & P 500) very short term countertrend Wave 4 upcycle (since 3-6-09) appears to have peaked shortly after the open today 3-11-09, then, a Wave A down move occurred for most of the session, followed by a brief countertrend Wave B move, and, SPX (S & P 500) probably ended today 3-11's session in a Wave C type downcycle.
Broad market Lead Indicator Walmart (WMT) also looks like it'll be weak early tomorrow, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
The broad market Walmart (WMT) Lead Indicator has turned super bearish, at -2.73% versus SPX (S & P 500) today/on 3-11, at -3.93% on 3-10, -1.86% on 3-9, and, -1.81% on 3-6, which jives with a very large Wave 5 type downcycle occurring the next few days (Wave 5 down of the Wave C monthly downcycle since late January).
The super bullish broad market Walmart (WMT) Lead Indicator on Thursday 3-5-09, at +6.85% versus SPX (S & P 500), correctly pointed to a very large countertrend Wave 4 upcycle.
SPX (S & P 500) was up a huge +6.37% yesterday 3-10-09, which was a very obvious huge spike move, that's typical of important peaking action. The Wave 5 move down (Wave 5 down of the Wave C Monthly Downcycle since late January, see http://stockcharts.com/charts/gallery.html?%24spx) is likely to be very very large (yes, two verys).
SPX (S & P 500) experienced a significant +1.47% rise in complacency/-1.47% decline in the wall of worry today 3-11, since SPX (S & P 500) rose only +0.24% versus the SPX Volatility Index VIX falling -1.71%, which points to likely significant SPX (S & P 500)/market weakness early on Thursday 3-12-09.
For the stem cell stocks (potential (appear likely to be) rockets) STEM (http://stockcharts.com/charts/gallery.html?stem) and GERN (http://stockcharts.com/charts/gallery.html?gern), see STEM http://finance.yahoo.com/q/ta?s=stem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, I'm watching to see if 3-9's huge downside gaps are bullish breakaway gaps/don't get filled. It looks like those gaps might get filled. Also, one wants to trade with the wind/market at one's back. SPX (S & P 500) should be in an upcycle when trading long. Also, the sector being traded should be in an upcycle.
SPX's (S & P 500) Elliott Wave count is that SPX (S & P 500) is in a Wave C Monthly Downcycle since late January, of the Wave A Minor Intermediate Term Downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx. Wave C down, since late January, has a down up down up pattern on the daily chart, with Wave 4 up probably having peaked early today 3-11-09.
The five day intraday broad market Walmart (WMT) Lead Indicator is super bearish at today 3-11-09's close, 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, which jives with severe weakness tomorrow 3-12-09.
Broad market Lead Indicator WMT is doing a very short term Wave C downcycle since mid session yesterday 3-10-09, see http://stockcharts.com/charts/gallery.html?wmt.
SPX (S & P 500) has a downside gap at 676.53 from yesterday 3-10-09's open, which one should watch this week, because, one will probably want to exit a (day trade and maybe also overnight timeframe short positions) short position shortly after that downside gap gets filled.
I'll be looking to day trade ultra short early on Thursday via probably DUG (UltraShort Oil and Gas ETF, the XOM (Exxon Mobil) Lead Indicator was a very bearish -1.90% versus the XOI (AMEX Oil and Gas) today/on 3-11, it was -1.22% on 3-10), or, SRS (UltraShort Real Estate ETF), FAZ (3x Finance Bear ETF), QID (UltraShort NASDAQ 100 (NDX) ETF), SMN (UltraShort Basic Materials ETF) etc. I also might look at the UltraShort Gold ProShares (GLL) ETF.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
Today I day traded DUG (UltraShort Oil and Gas ETF) once, and, I made 7+ cents/share = $70+ for each 1000 shares traded. I entered my trade before the deceptive intraday XOI double top occurred, and had a difficult day (peaking sessions can be difficult). The fast stochastics definitely appear to be a highly useful indicator (it's a new indicator for my day trading/intraday entry/exit points), but, are secondary to cycles, Elliott Wave patterns, and gaps, as all indicators are.
I think the fast stochastic lines (%K and %D) will probably help a lot, with day trading and entry points in general. It looks like the %K line tends to bottom ahead of an entry point, and, sometimes it crosses above the %D line ahead of an entry point (Yahoo's stochastics might be the slow ones, not the fast stochastics, I'm talking about the fast stochastics in my broker's charts), see http://finance.yahoo.com/q/ta?s=faz&t=1d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=. One apparently wants to (generally at least) be long when the %K line is above the %D line, and, one should be in cash when that's not the case.
A good short now appears to be the NASDAQ 100 (NDX), see http://stockcharts.com/charts/gallery.html?%24ndx, which put in a slightly higher bearish double top on 2-10-09 at 1286.90 (countertrend Wave B minor intermediate term cycle high), versus early January 2009's cycle high at 1286.08. 2-10-09's cycle high was the countertrend Wave B minor intermediate term upcycle peaking in dramatic rollover mode at 1286.90 (similar to countertrend Wave B action, but, surprising modestly to the upside), versus the early January 2009 cycle high at 1286.08.
I'll probably wait for the NASDAQ 100 (NDX) to do a short term/monthly countertrend Wave B upcycle, before trading/holding a QID position overnight.
WMT has bearish breakaway upside gaps at 52.12, and 55.54, and, has a downside bullish breakaway gap at 48.49 (filled 3-9-09), 46.53 (created 2-17-09). SPX (S & P 500) has bearish breakaway upside gaps at 712.87 (filled 3-10-09), 735.09, 752.83, 826.84, 869.89, and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx. SPX (S & P 500) has a downside gap at 676.53 from today 3-10-09's open.
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.
Reliable broad market Lead Indicator Walmart's (WMT) huge very bearish breakaway type gap down on 1-8-09 from 55.54, see http://stockcharts.com/charts/gallery.html?wmt, portended the recent/current substantial weakness for WMT/SPX and the market/most indexes/sectors.
GDX/HUI/XAU are in Wave B up of Wave A down of a Short Term Wave C Downcycle since 3-6-09, of the Wave 2 Minor Intermediate Term Downcycle since 2-17-09, see http://stockcharts.com/charts/gallery.html?gdx.
The gold ETF GLD (http://stockcharts.com/charts/gallery.html?gld) and gold put in a Wave 1 Minor Intermediate Term cycle high on 2-20-09, lagging GDX/HUI/XAU (peaked 2-17-09) and NEM (peaked 1-26-09, reliably leading GDX/HUI/XAU and GLD/gold as usual) as they tend to do.
Reliable gold/silver sector lead indicator NEM's cycle high at 45.45/candle on 1-26-09, see http://stockcharts.com/charts/gallery.html?NEM, is a Wave 1 minor intermediate term cycle high (cycle began in late November 2008), and, the short term countertrend Wave B upcycle peaked at 45 on 2-20-09.
One needs to wait for a 3 to 6 week GDX/HUI/XAU Wave 2 minor intermediate term downcycle to occur, before a good entry point will arise for long term investors.
The NEM Lead Indicator was a bearish -0.78% versus the XAU today/on 3-11, it was an extremely bearish -2.51% on 3-10, which correctly was a very short term bullish indication, it was +0.55% on 3-9, it was a super bearish -4.07% on 3-6, it was -0.84% on 3-5, it was +0.21% on 3-4, it was -0.95% on 3-3, it was a very bearish -1.38% on 3-2, it was an extremely bullish +2.97% on 2-27, which correctly was a very short term bearish indication, it was -0.07% on 2-26, +0.64% on 2-25, +1.98% on 2-24, +0.19% on 2-23, +3.48% on 2-20, which correctly was a very short term bearish indication (the XAU was down -3.25% on 2-23-09), +0.01% on 2-19, -1.55% on 2-18, +1.95% on 2-17, -1.20% on 2-13, +0.34% on 2-12, +0.61% on 2-11.
The bearish short term and minor intermediate term scenario jives with the bearish gold COT (Commitments Of Traders) data the past six weeks. The savvy non contrarian gold Commercial Traders traded aggressively short for four straight weeks prior to the last two weeks, when they traded significantly net long, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm, but, they engaged in significant long liquidation in the latest report dated 3-3-09.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 31.40 (filled 3-9), 29.67, 29.13, 25.41, and 23.23. GDX has bearish breakaway upside gaps at 31.55, 32.88. NEM has downside gaps at TBD.
Gold hit a 5% major buy signal six weeks ago, see annotated chart two at http://www.joefrocks.com/GoldStockCharts.html, which indicates that gold very likely entered a Wave 3 Cyclical Bull Market in late October 2008.
Note that gold did an inverse Elliott Wave 12345 down up down up down pattern, from the 3-17-08 Wave 1 Cyclical Bull Market cycle high at $1033.90, to the likely Wave 2 Cyclical Bear Market cycle low at $681 in late October 2008, see the second weekly view chart at http://stockcharts.com/charts/gallery.html?%24gold. Note also, that in both the first daily view chart and the second weekly view chart, that gold has a very large bullish inverse spike at the $681 cycle low in late October 2008.
The XOM (Exxon Mobil) Lead Indicator was a very bearish -1.90% versus the XOI (AMEX Oil and Gas) today/on 3-11, it was -1.22% on 3-10, it was +0.66% on 3-9, +1.10% on 3-6, -0.63% on 3-5, -2.98% on 3-4, -0.38% on 3-3, +2.68% on 3-2, -1.89% on 2-27, -1.51% on 2-26, +0.65% on 2-25, -0.64% on 2-24, +1.04% on 2-23, +1.43% on 2-20, -0.02% on 2-19, +1.94% on 2-18, +2.00% on 2-17, -1.14% on 2-13, +0.44% on 2-12, -1.99% on 2-11, +0.77% on 2-10, -1.43% on 2-9, -1.06% on 2-6, +1.50% on 2-5, -1.06% on 2-4, -0.49% on 2-3, +1.86% on 2-2, +0.92% on 1-30, +0.80% on 1-29, -2.15% on 1-28, +0.37% on 1-27, -2.11% on 1-26, -2.41% on 1-23, +1.36% on 1-22, -1.43% on 1-21.
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 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 Cyclical Bear Market from/since 2004 for example (has been in a multi decade Secular Bear Market also), 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.
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
If one looks at the second weekly view chart (at http://stockcharts.com/charts/gallery.html?%24spx) one can see that SPX (S & P 500) probably didn't bottom yet/on 3-6-09, because, the inverse spike is too small/not bullish enough, and, the candle is red/bearish, indicating a weekly close below the weekly open.
Looking at SPX's (S & P 500) five day intraday chart, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=, one can see that SPX's (S & P 500) very short term countertrend Wave 4 upcycle (since 3-6-09) appears to have peaked shortly after the open today 3-11-09, then, a Wave A down move occurred for most of the session, followed by a brief countertrend Wave B move, and, SPX (S & P 500) probably ended today 3-11's session in a Wave C type downcycle.
Broad market Lead Indicator Walmart (WMT) also looks like it'll be weak early tomorrow, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=.
The broad market Walmart (WMT) Lead Indicator has turned super bearish, at -2.73% versus SPX (S & P 500) today/on 3-11, at -3.93% on 3-10, -1.86% on 3-9, and, -1.81% on 3-6, which jives with a very large Wave 5 type downcycle occurring the next few days (Wave 5 down of the Wave C monthly downcycle since late January).
The super bullish broad market Walmart (WMT) Lead Indicator on Thursday 3-5-09, at +6.85% versus SPX (S & P 500), correctly pointed to a very large countertrend Wave 4 upcycle.
SPX (S & P 500) was up a huge +6.37% yesterday 3-10-09, which was a very obvious huge spike move, that's typical of important peaking action. The Wave 5 move down (Wave 5 down of the Wave C Monthly Downcycle since late January, see http://stockcharts.com/charts/gallery.html?%24spx) is likely to be very very large (yes, two verys).
SPX (S & P 500) experienced a significant +1.47% rise in complacency/-1.47% decline in the wall of worry today 3-11, since SPX (S & P 500) rose only +0.24% versus the SPX Volatility Index VIX falling -1.71%, which points to likely significant SPX (S & P 500)/market weakness early on Thursday 3-12-09.
For the stem cell stocks (potential (appear likely to be) rockets) STEM (http://stockcharts.com/charts/gallery.html?stem) and GERN (http://stockcharts.com/charts/gallery.html?gern), see STEM http://finance.yahoo.com/q/ta?s=stem&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, I'm watching to see if 3-9's huge downside gaps are bullish breakaway gaps/don't get filled. It looks like those gaps might get filled. Also, one wants to trade with the wind/market at one's back. SPX (S & P 500) should be in an upcycle when trading long. Also, the sector being traded should be in an upcycle.
SPX's (S & P 500) Elliott Wave count is that SPX (S & P 500) is in a Wave C Monthly Downcycle since late January, of the Wave A Minor Intermediate Term Downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx. Wave C down, since late January, has a down up down up pattern on the daily chart, with Wave 4 up probably having peaked early today 3-11-09.
The five day intraday broad market Walmart (WMT) Lead Indicator is super bearish at today 3-11-09's close, 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, which jives with severe weakness tomorrow 3-12-09.
Broad market Lead Indicator WMT is doing a very short term Wave C downcycle since mid session yesterday 3-10-09, see http://stockcharts.com/charts/gallery.html?wmt.
SPX (S & P 500) has a downside gap at 676.53 from yesterday 3-10-09's open, which one should watch this week, because, one will probably want to exit a (day trade and maybe also overnight timeframe short positions) short position shortly after that downside gap gets filled.
I'll be looking to day trade ultra short early on Thursday via probably DUG (UltraShort Oil and Gas ETF, the XOM (Exxon Mobil) Lead Indicator was a very bearish -1.90% versus the XOI (AMEX Oil and Gas) today/on 3-11, it was -1.22% on 3-10), or, SRS (UltraShort Real Estate ETF), FAZ (3x Finance Bear ETF), QID (UltraShort NASDAQ 100 (NDX) ETF), SMN (UltraShort Basic Materials ETF) etc. I also might look at the UltraShort Gold ProShares (GLL) ETF.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
Today I day traded DUG (UltraShort Oil and Gas ETF) once, and, I made 7+ cents/share = $70+ for each 1000 shares traded. I entered my trade before the deceptive intraday XOI double top occurred, and had a difficult day (peaking sessions can be difficult). The fast stochastics definitely appear to be a highly useful indicator (it's a new indicator for my day trading/intraday entry/exit points), but, are secondary to cycles, Elliott Wave patterns, and gaps, as all indicators are.
I think the fast stochastic lines (%K and %D) will probably help a lot, with day trading and entry points in general. It looks like the %K line tends to bottom ahead of an entry point, and, sometimes it crosses above the %D line ahead of an entry point (Yahoo's stochastics might be the slow ones, not the fast stochastics, I'm talking about the fast stochastics in my broker's charts), see http://finance.yahoo.com/q/ta?s=faz&t=1d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=. One apparently wants to (generally at least) be long when the %K line is above the %D line, and, one should be in cash when that's not the case.
A good short now appears to be the NASDAQ 100 (NDX), see http://stockcharts.com/charts/gallery.html?%24ndx, which put in a slightly higher bearish double top on 2-10-09 at 1286.90 (countertrend Wave B minor intermediate term cycle high), versus early January 2009's cycle high at 1286.08. 2-10-09's cycle high was the countertrend Wave B minor intermediate term upcycle peaking in dramatic rollover mode at 1286.90 (similar to countertrend Wave B action, but, surprising modestly to the upside), versus the early January 2009 cycle high at 1286.08.
I'll probably wait for the NASDAQ 100 (NDX) to do a short term/monthly countertrend Wave B upcycle, before trading/holding a QID position overnight.
WMT has bearish breakaway upside gaps at 52.12, and 55.54, and, has a downside bullish breakaway gap at 48.49 (filled 3-9-09), 46.53 (created 2-17-09). SPX (S & P 500) has bearish breakaway upside gaps at 712.87 (filled 3-10-09), 735.09, 752.83, 826.84, 869.89, and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx. SPX (S & P 500) has a downside gap at 676.53 from today 3-10-09's open.
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.
Reliable broad market Lead Indicator Walmart's (WMT) huge very bearish breakaway type gap down on 1-8-09 from 55.54, see http://stockcharts.com/charts/gallery.html?wmt, portended the recent/current substantial weakness for WMT/SPX and the market/most indexes/sectors.
GDX/HUI/XAU are in Wave B up of Wave A down of a Short Term Wave C Downcycle since 3-6-09, of the Wave 2 Minor Intermediate Term Downcycle since 2-17-09, see http://stockcharts.com/charts/gallery.html?gdx.
The gold ETF GLD (http://stockcharts.com/charts/gallery.html?gld) and gold put in a Wave 1 Minor Intermediate Term cycle high on 2-20-09, lagging GDX/HUI/XAU (peaked 2-17-09) and NEM (peaked 1-26-09, reliably leading GDX/HUI/XAU and GLD/gold as usual) as they tend to do.
Reliable gold/silver sector lead indicator NEM's cycle high at 45.45/candle on 1-26-09, see http://stockcharts.com/charts/gallery.html?NEM, is a Wave 1 minor intermediate term cycle high (cycle began in late November 2008), and, the short term countertrend Wave B upcycle peaked at 45 on 2-20-09.
One needs to wait for a 3 to 6 week GDX/HUI/XAU Wave 2 minor intermediate term downcycle to occur, before a good entry point will arise for long term investors.
The NEM Lead Indicator was a bearish -0.78% versus the XAU today/on 3-11, it was an extremely bearish -2.51% on 3-10, which correctly was a very short term bullish indication, it was +0.55% on 3-9, it was a super bearish -4.07% on 3-6, it was -0.84% on 3-5, it was +0.21% on 3-4, it was -0.95% on 3-3, it was a very bearish -1.38% on 3-2, it was an extremely bullish +2.97% on 2-27, which correctly was a very short term bearish indication, it was -0.07% on 2-26, +0.64% on 2-25, +1.98% on 2-24, +0.19% on 2-23, +3.48% on 2-20, which correctly was a very short term bearish indication (the XAU was down -3.25% on 2-23-09), +0.01% on 2-19, -1.55% on 2-18, +1.95% on 2-17, -1.20% on 2-13, +0.34% on 2-12, +0.61% on 2-11.
The bearish short term and minor intermediate term scenario jives with the bearish gold COT (Commitments Of Traders) data the past six weeks. The savvy non contrarian gold Commercial Traders traded aggressively short for four straight weeks prior to the last two weeks, when they traded significantly net long, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm, but, they engaged in significant long liquidation in the latest report dated 3-3-09.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 31.40 (filled 3-9), 29.67, 29.13, 25.41, and 23.23. GDX has bearish breakaway upside gaps at 31.55, 32.88. NEM has downside gaps at TBD.
Gold hit a 5% major buy signal six weeks ago, see annotated chart two at http://www.joefrocks.com/GoldStockCharts.html, which indicates that gold very likely entered a Wave 3 Cyclical Bull Market in late October 2008.
Note that gold did an inverse Elliott Wave 12345 down up down up down pattern, from the 3-17-08 Wave 1 Cyclical Bull Market cycle high at $1033.90, to the likely Wave 2 Cyclical Bear Market cycle low at $681 in late October 2008, see the second weekly view chart at http://stockcharts.com/charts/gallery.html?%24gold. Note also, that in both the first daily view chart and the second weekly view chart, that gold has a very large bullish inverse spike at the $681 cycle low in late October 2008.
The XOM (Exxon Mobil) Lead Indicator was a very bearish -1.90% versus the XOI (AMEX Oil and Gas) today/on 3-11, it was -1.22% on 3-10, it was +0.66% on 3-9, +1.10% on 3-6, -0.63% on 3-5, -2.98% on 3-4, -0.38% on 3-3, +2.68% on 3-2, -1.89% on 2-27, -1.51% on 2-26, +0.65% on 2-25, -0.64% on 2-24, +1.04% on 2-23, +1.43% on 2-20, -0.02% on 2-19, +1.94% on 2-18, +2.00% on 2-17, -1.14% on 2-13, +0.44% on 2-12, -1.99% on 2-11, +0.77% on 2-10, -1.43% on 2-9, -1.06% on 2-6, +1.50% on 2-5, -1.06% on 2-4, -0.49% on 2-3, +1.86% on 2-2, +0.92% on 1-30, +0.80% on 1-29, -2.15% on 1-28, +0.37% on 1-27, -2.11% on 1-26, -2.41% on 1-23, +1.36% on 1-22, -1.43% on 1-21.
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 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 Cyclical Bear Market from/since 2004 for example (has been in a multi decade Secular Bear Market also), 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.
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, SRS, XAU, XOI, XOM
posted by Joe Ferrazzano at
1:56 PM
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