The Countertrend Wave B Upcycle Since 3-6-09 Probably Lives
The countertrend Wave B upcycle since 3-6-09 probably lives (Wave B up of the Intermediate Term Downcycle since 1-6-09), see http://stockcharts.com/charts/gallery.html?%24spx, but not for long.
Given yesterday 4-2's very bearish broad market Walmart (WMT) Lead Indicator, which closed at -1.32% versus SPX (S & P 500) on 4-2 (-0.28% on 4-1, -0.65% on 3-31), there should have been more weakness today, which means that SPX (S & P 500)/the market is still probably heading up.
Here's what's going on, SPX (S & P 500) is doing Wave 5 up of the monster rollover Wave 5 upcycle since 3-30-09, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
Wave 1 peaked on Tuesday 3-31, Wave 3 peaked yesterday 4-2, note the spikes on the daily candle those days, see http://stockcharts.com/charts/gallery.html?%24spx. SPX (S & P 500) entered Wave 5 up early today 4-3, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=, and, will probably peak early on Monday, then, I might dive into a FAZ (3x Finance Bear ETF) day trade.
The above analysis jives with the extremely bearish broad market Walmart (WMT) Lead Indicator now, at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31.
Also, the five day intraday broad market Walmart (WMT) Lead Indicator was very bearish at session's end today 4-3-09, 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 points to severe weakness after likely early strength on Monday.
The broad market Walmart (WMT) Lead Indicator is extremely bearish since 3-6-09 (countertrend Wave B upcycle began), at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31, +1.94% on 3-30, +1.67% on 3-27, -0.24% on 3-26, +0.22% on 3-25, +1.23% on 3-24, -3.27% on 3-23, +1.26% on 3-20, +0.33% on 3-19, -1.21% on 3-18, -0.75% on 3-17, -0.44% on 3-16, -0.26% on 3-13, -0.95% on 3-12, -2.73% on 3-11, -3.93% on 3-10, -1.86% on 3-9, -1.81% on 3-6.
Also, SPX (S & P 500) experienced a very sharp +4.40% rise in complacency/-4.40% decline in the wall of worry today 4-3, since SPX (S & P 500) rose +0.97% versus the SPX Volatility Index VIX falling -5.57%, which points to likely substantial SPX (S & P 500)/market weakness early on Monday 4-6-09, after likely strength very early on (Wave 5 up of the monster rollover Wave 5 upcycle since 3-30-09).
Lastly, the S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) COT (Commitments Of Traders) data jives with the countertrend Wave B Monthly Upcycle since 3-6-09 peaking Monday/early next week (countertrend Wave B up of the intermediate term downcycle since 1-6-09), see the major averages COT data that starts about two thirds of the way down (S & P 500 is the first set of data) at http://www.cftc.gov/dea/futures/deacmelf.htm, since the savvy non contrarian S & P 500 Commercial Traders traded significantly net short again this week, adding a relatively aggressive 11,152 short futures contracts versus adding 1192 long futures contracts.
The S & P 500's (SPX, http://stockcharts.com/charts/gallery.html?%24spx) huge spike move/monster rollover Wave 5 upcycle since 3-30-09 jives with important peaking action, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
FAZ (3x Finance Bear ETF) is an opportunity to make a lot of money now (probably for the next few weeks/months), which is why so many are trading it (over 85 million shares traded today). Not a recommendation.
Follow my live updates at Twitter! I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow after doing a search for tradethecycles. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles. I just started using Twitter about a week or two ago. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I'll opine about other subjects.
The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) COT (Commitments Of Traders) data reeks of countertrend Wave B Monthly Upcycle since 3-6-09 (countertrend Wave B up of the intermediate term downcycle since 1-6-09), see the major averages COT data that starts about two thirds of the way down (S & P 500 is the first set of data) at http://www.cftc.gov/dea/futures/deacmelf.htm.
The savvy non contrarian S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) and other major averages Commercial Traders experienced a gigantic short squeeze, since they covered a massive amount of short futures in the previous report, but, they also liquidated a massive amount of their long futures position in the previous report, which strongly jives with the monthly upcycle since 3-6-09 being countertrend action. Why would they liquidate a massive amount of their long futures position, if they believed that a new bull market had begun?
Given that it's very unlikely that the S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) Cyclical Bear Market since 10-11-07 bottomed on 3-6-09, then, the upcycle since 3-6-09 basically HAS to be countertrend action.
My strategy next week will be to day trade DUG (UltraShort Oil and Gas ETF) or some other ultra short ETF (like FAZ maybe), overnight trade a substantial ultra short position, and, I'll also overnight trade a tiny FAZ (3x Finance Bear ETF) position in an IRA. For the overnight trades I'll be careful to wait for a very large Wave A down type move to occur first (probably in progress), then I'll look to go long QID/FAZ shortly after a countertrend Wave B type upcycle peaks.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
WMT has bearish breakaway upside gaps at 52.12 (filled 3-25), 52.57 (filled 4-1), and 55.54, and, has a downside gap at 52.82.
SPX (S & P 500) has bearish breakaway upside gaps at 712.87 (filled 3-10-09), 735.09 (filled 3-12-09), 752.83 (filled 3-13-09), 826.84 (filled 3-26-09), 815.94 (filled 4-2-09), 832.86 (filled 4-2-09), 869.89, and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) has a downside gap at 811.08 from 4-2's open, one at 768.54 from 3-23-09's open, and, one at 676.53 from 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 substantial weakness for WMT/SPX and the market/most indexes/sectors.
Follow my live updates at Twitter! I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow after doing a search for tradethecycles. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles. I just started using Twitter about a week or two ago. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I'll opine about other subjects.
The XAU is doing Wave 4 down of a very large short term Wave 3 upcycle, of the monster Wave 5 rollover monthly upcycle (of the Wave 1 Minor Intermediate Term Upcycle since late October 2008) since early March, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI are doing a short term Wave 4 downcycle, see their daily chart.
The NEM Lead Indicator is extremely bullish, at +0.02% versus the XAU today/on 4-3, +1.95% on 4-2, +1.36% on 4-1, -1.62% on 3-31, +0.87% on 3-30, +0.38% on 3-27, +1.54% on 3-26, +1.43% on 3-25, +0.07% on 3-24, +0.00% on 3-23, +3.26% on 3-20, +1.39% on 3-19, +0.89% on 3-18, offset some by the broad market WMT Lead Indicator, at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31.
The XAU still needs to do a huge Wave 5 up of a very large Wave 3 upcycle, followed probably by (after a huge short term Wave 4 downcycle) a huge final, probably spectacular, Wave 5 type blowoff spike move, that'll probably mark the end of the Wave 1 Intermediate Term Upcycle since late October 2008.
After the XAU (http://stockcharts.com/charts/gallery.html?%24xau) does Wave 5 up of a very large short term Wave 3 upcycle there should be a one to two weekish very large short term Wave 4 downcycle, during which time GDX/HUI should do a one to two weekish monthly downcycle, then comes the huge final, probably spectacular, Wave 5 type blowoff spike move, that'll probably mark the end of the Wave 1 Intermediate Term Upcycle since late October 2008.
I sold my substantial NEM position held in an IRA shortly before session's end on 4-1-09 at 47.3301, because, NEM leads, and, was extremely overbought.
The slightly lower XAU cycle high in mid March, versus the one in early March, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau, is probably Wave 1 up of a big short term Wave 3 upcycle, note that it's slightly lower than the short term Wave 1 cycle high in early March.
The monster spike move on 3-18-09, following the huge $1 Trillion Fed action announced after the FOMC, was a short term breakout.
Also, the reliable gold/silver sector NEM Lead Indicator has turned extremely bullish since the 3-18-09 GDX/HUI/XAU/NEM (http://stockcharts.com/charts/gallery.html?%24xau) short term breakout, at +0.02% versus the XAU today/on 4-3, +1.95% on 4-2, +1.36% on 4-1, -1.62% on 3-31, +0.87% on 3-30, +0.38% on 3-27, +1.54% on 3-26, +1.43% on 3-25, +0.07% on 3-24, +0.00% on 3-23, +3.26% on 3-20, +1.39% on 3-19, +0.89% on 3-18.
The gold COT (Commitments Of Traders) data continues to jive with a short term bullish and an intermediate term bearish scenario, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm, since the savvy non contrarian gold Commercial Traders traded a respectable long gold futures and options position in the five day period ending 3-24-09, while adding even more short gold futures and options, in anticipation of a substantial correction/intermediate term downcycle. In the latest five day period ending 3-31-09, the savvy non contrarian gold Commercial Traders engaged in both massive short covering and massive long liquidation, which doesn't change the assessment.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 36.88 (filled 4-2), 31.34 (filled 3-18), 29.67, 29.13, 25.41, and 23.23. GDX has a very bullish breakaway downside gap at 35.07. NEM has downside gaps at 36.66 (filled 3-17) and TBD, and, has a downside bullish breakaway gap at 40.14 from 3-19's open.
Gold hit a 5% major buy signal nine 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 bearish -0.57% versus the XOI (AMEX Oil and Gas) today/on 4-3, it was -2.70% on 4-2, it was -0.27% on 4-1, -1.04% on 3-31, +1.96% on 3-30, +1.27% on 3-27, +0.70% on 3-26, +0.04% on 3-25, +0.82% on 3-24, -0.15% on 3-23, +0.13% on 3-20, -3.32% on 3-19, -0.46% on 3-18, +0.00% on 3-17, -0.58% on 3-16, +1.09% on 3-13, -0.78% on 3-12, -1.90% on 3-11, -1.22% on 3-10, +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
Given yesterday 4-2's very bearish broad market Walmart (WMT) Lead Indicator, which closed at -1.32% versus SPX (S & P 500) on 4-2 (-0.28% on 4-1, -0.65% on 3-31), there should have been more weakness today, which means that SPX (S & P 500)/the market is still probably heading up.
Here's what's going on, SPX (S & P 500) is doing Wave 5 up of the monster rollover Wave 5 upcycle since 3-30-09, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
Wave 1 peaked on Tuesday 3-31, Wave 3 peaked yesterday 4-2, note the spikes on the daily candle those days, see http://stockcharts.com/charts/gallery.html?%24spx. SPX (S & P 500) entered Wave 5 up early today 4-3, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=, and, will probably peak early on Monday, then, I might dive into a FAZ (3x Finance Bear ETF) day trade.
The above analysis jives with the extremely bearish broad market Walmart (WMT) Lead Indicator now, at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31.
Also, the five day intraday broad market Walmart (WMT) Lead Indicator was very bearish at session's end today 4-3-09, 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 points to severe weakness after likely early strength on Monday.
The broad market Walmart (WMT) Lead Indicator is extremely bearish since 3-6-09 (countertrend Wave B upcycle began), at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31, +1.94% on 3-30, +1.67% on 3-27, -0.24% on 3-26, +0.22% on 3-25, +1.23% on 3-24, -3.27% on 3-23, +1.26% on 3-20, +0.33% on 3-19, -1.21% on 3-18, -0.75% on 3-17, -0.44% on 3-16, -0.26% on 3-13, -0.95% on 3-12, -2.73% on 3-11, -3.93% on 3-10, -1.86% on 3-9, -1.81% on 3-6.
Also, SPX (S & P 500) experienced a very sharp +4.40% rise in complacency/-4.40% decline in the wall of worry today 4-3, since SPX (S & P 500) rose +0.97% versus the SPX Volatility Index VIX falling -5.57%, which points to likely substantial SPX (S & P 500)/market weakness early on Monday 4-6-09, after likely strength very early on (Wave 5 up of the monster rollover Wave 5 upcycle since 3-30-09).
Lastly, the S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) COT (Commitments Of Traders) data jives with the countertrend Wave B Monthly Upcycle since 3-6-09 peaking Monday/early next week (countertrend Wave B up of the intermediate term downcycle since 1-6-09), see the major averages COT data that starts about two thirds of the way down (S & P 500 is the first set of data) at http://www.cftc.gov/dea/futures/deacmelf.htm, since the savvy non contrarian S & P 500 Commercial Traders traded significantly net short again this week, adding a relatively aggressive 11,152 short futures contracts versus adding 1192 long futures contracts.
The S & P 500's (SPX, http://stockcharts.com/charts/gallery.html?%24spx) huge spike move/monster rollover Wave 5 upcycle since 3-30-09 jives with important peaking action, see http://finance.yahoo.com/q/ta?s=^GSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.
FAZ (3x Finance Bear ETF) is an opportunity to make a lot of money now (probably for the next few weeks/months), which is why so many are trading it (over 85 million shares traded today). Not a recommendation.
Follow my live updates at Twitter! I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow after doing a search for tradethecycles. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles. I just started using Twitter about a week or two ago. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I'll opine about other subjects.
The S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) COT (Commitments Of Traders) data reeks of countertrend Wave B Monthly Upcycle since 3-6-09 (countertrend Wave B up of the intermediate term downcycle since 1-6-09), see the major averages COT data that starts about two thirds of the way down (S & P 500 is the first set of data) at http://www.cftc.gov/dea/futures/deacmelf.htm.
The savvy non contrarian S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) and other major averages Commercial Traders experienced a gigantic short squeeze, since they covered a massive amount of short futures in the previous report, but, they also liquidated a massive amount of their long futures position in the previous report, which strongly jives with the monthly upcycle since 3-6-09 being countertrend action. Why would they liquidate a massive amount of their long futures position, if they believed that a new bull market had begun?
Given that it's very unlikely that the S & P 500 (SPX, http://stockcharts.com/charts/gallery.html?%24spx) Cyclical Bear Market since 10-11-07 bottomed on 3-6-09, then, the upcycle since 3-6-09 basically HAS to be countertrend action.
My strategy next week will be to day trade DUG (UltraShort Oil and Gas ETF) or some other ultra short ETF (like FAZ maybe), overnight trade a substantial ultra short position, and, I'll also overnight trade a tiny FAZ (3x Finance Bear ETF) position in an IRA. For the overnight trades I'll be careful to wait for a very large Wave A down type move to occur first (probably in progress), then I'll look to go long QID/FAZ shortly after a countertrend Wave B type upcycle peaks.
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
WMT has bearish breakaway upside gaps at 52.12 (filled 3-25), 52.57 (filled 4-1), and 55.54, and, has a downside gap at 52.82.
SPX (S & P 500) has bearish breakaway upside gaps at 712.87 (filled 3-10-09), 735.09 (filled 3-12-09), 752.83 (filled 3-13-09), 826.84 (filled 3-26-09), 815.94 (filled 4-2-09), 832.86 (filled 4-2-09), 869.89, and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) has a downside gap at 811.08 from 4-2's open, one at 768.54 from 3-23-09's open, and, one at 676.53 from 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 substantial weakness for WMT/SPX and the market/most indexes/sectors.
Follow my live updates at Twitter! I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow after doing a search for tradethecycles. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles. I just started using Twitter about a week or two ago. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I'll opine about other subjects.
The XAU is doing Wave 4 down of a very large short term Wave 3 upcycle, of the monster Wave 5 rollover monthly upcycle (of the Wave 1 Minor Intermediate Term Upcycle since late October 2008) since early March, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI are doing a short term Wave 4 downcycle, see their daily chart.
The NEM Lead Indicator is extremely bullish, at +0.02% versus the XAU today/on 4-3, +1.95% on 4-2, +1.36% on 4-1, -1.62% on 3-31, +0.87% on 3-30, +0.38% on 3-27, +1.54% on 3-26, +1.43% on 3-25, +0.07% on 3-24, +0.00% on 3-23, +3.26% on 3-20, +1.39% on 3-19, +0.89% on 3-18, offset some by the broad market WMT Lead Indicator, at -0.67% versus SPX (S & P 500) today/on 4-3, -1.32% on 4-2, -0.28% on 4-1, -0.65% on 3-31.
The XAU still needs to do a huge Wave 5 up of a very large Wave 3 upcycle, followed probably by (after a huge short term Wave 4 downcycle) a huge final, probably spectacular, Wave 5 type blowoff spike move, that'll probably mark the end of the Wave 1 Intermediate Term Upcycle since late October 2008.
After the XAU (http://stockcharts.com/charts/gallery.html?%24xau) does Wave 5 up of a very large short term Wave 3 upcycle there should be a one to two weekish very large short term Wave 4 downcycle, during which time GDX/HUI should do a one to two weekish monthly downcycle, then comes the huge final, probably spectacular, Wave 5 type blowoff spike move, that'll probably mark the end of the Wave 1 Intermediate Term Upcycle since late October 2008.
I sold my substantial NEM position held in an IRA shortly before session's end on 4-1-09 at 47.3301, because, NEM leads, and, was extremely overbought.
The slightly lower XAU cycle high in mid March, versus the one in early March, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau, is probably Wave 1 up of a big short term Wave 3 upcycle, note that it's slightly lower than the short term Wave 1 cycle high in early March.
The monster spike move on 3-18-09, following the huge $1 Trillion Fed action announced after the FOMC, was a short term breakout.
Also, the reliable gold/silver sector NEM Lead Indicator has turned extremely bullish since the 3-18-09 GDX/HUI/XAU/NEM (http://stockcharts.com/charts/gallery.html?%24xau) short term breakout, at +0.02% versus the XAU today/on 4-3, +1.95% on 4-2, +1.36% on 4-1, -1.62% on 3-31, +0.87% on 3-30, +0.38% on 3-27, +1.54% on 3-26, +1.43% on 3-25, +0.07% on 3-24, +0.00% on 3-23, +3.26% on 3-20, +1.39% on 3-19, +0.89% on 3-18.
The gold COT (Commitments Of Traders) data continues to jive with a short term bullish and an intermediate term bearish scenario, see the third/last data at http://www.cftc.gov/dea/options/deacmxsof.htm, since the savvy non contrarian gold Commercial Traders traded a respectable long gold futures and options position in the five day period ending 3-24-09, while adding even more short gold futures and options, in anticipation of a substantial correction/intermediate term downcycle. In the latest five day period ending 3-31-09, the savvy non contrarian gold Commercial Traders engaged in both massive short covering and massive long liquidation, which doesn't change the assessment.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 36.88 (filled 4-2), 31.34 (filled 3-18), 29.67, 29.13, 25.41, and 23.23. GDX has a very bullish breakaway downside gap at 35.07. NEM has downside gaps at 36.66 (filled 3-17) and TBD, and, has a downside bullish breakaway gap at 40.14 from 3-19's open.
Gold hit a 5% major buy signal nine 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 bearish -0.57% versus the XOI (AMEX Oil and Gas) today/on 4-3, it was -2.70% on 4-2, it was -0.27% on 4-1, -1.04% on 3-31, +1.96% on 3-30, +1.27% on 3-27, +0.70% on 3-26, +0.04% on 3-25, +0.82% on 3-24, -0.15% on 3-23, +0.13% on 3-20, -3.32% on 3-19, -0.46% on 3-18, +0.00% on 3-17, -0.58% on 3-16, +1.09% on 3-13, -0.78% on 3-12, -1.90% on 3-11, -1.22% on 3-10, +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
2:29 PM
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