Important Factors Are Pointing To An Imminent Important S & P 500 (SPX)/Market Cycle High
Important factors are pointing to an imminent important S & P 500 (SPX)/market cycle high. One factor is the huge spike move the past six sessions, see http://stockcharts.com/charts/gallery.html?%24spx, that obviously has the look of gravity defying important peaking action, a likely final huge Wave 5 type blowoff spike move. Since 4-21-09 SPX (S & P 500) has done an up down up down up Elliott Wave pattern.
Other factors (discussed below) pointing to an imminent important S & P 500 (SPX)/market cycle high are VIX, the super bearish five day (and since 3-6-09) intraday broad market Walmart (WMT) Lead Indicator, and, an extremely overbought condition.
This might be the strongest two month SPX (S & P 500) upcycle ever. Remember that countertrend action tends to be considerably stronger than what normally occurs in most upcycles, because, it's important peaking action.
A likely scenario is that SPX (S & P 500) will peak shortly after filling or failing to fill the upside gap at 934.70, possibly tomorrow (broad market Walmart (WMT) Lead Indicator was an extremely bearish -3.62% versus SPX (S & P 500) today/on 5-6).
One of today's Tweets: "The market's partying like 1999, and, it'll probably end like March 2000. The more gravity defying action, the more severe bust tends to be."
Follow my live updates (the "play by play") at Twitter!, at http://twitter.com/tradethecycles. Highly recommended. I'm having fun and networking, in addition to microblogging my Trade the Cycles work/system and opining about a variety of subjects. I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles.
Since 4-21-09 SPX (S & P 500) has done an up down up down up Elliott Wave pattern, with the huge upcycle the past six sessions appearing to be the final Wave 5 blowoff spike move, of the likely countertrend Wave B Minor Intermediate Term upcycle since 3-6-09, see http://stockcharts.com/charts/gallery.html?%24spx, and, is an attempt at filling the upside gap at 934.70.
As long as SPX (S & P 500) peaks below the 1-6-09 943.85 cycle high, see chart two at http://stockcharts.com/charts/gallery.html?%24spx, then, the upcoming cycle high will probably be, until proven otherwise, a countertrend Wave B type cycle high, that's probably Wave B up of the Intermediate Term Downcycle since 1-6-09, to be precise.
Another important factor pointing to an imminent important S & P 500 (SPX)/market cycle high is the super bearish five day intraday broad market Walmart (WMT) Lead Indicator at session's end today 5-6-09, 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, at about -6.50% or more vs the S & P 500, signaling an imminent potentially important cycle high.
Also, the broad market Walmart (WMT) Lead Indicator (data since 3-6-09, when a likely countertrend Wave B Minor Intermediate Term Upcycle began) is super bearish since 3-6-09, at -3.62% versus the S & P 500 today/on 5-6, -0.37% on 5-5, -1.81% on 5-4, -1.23% on 5-1, +0.00% on 4-30, +1.92% on 4-29, +0.19% on 4-28, +2.35% on 4-27, -3.71% on 4-24, -1.19% on 4-23, -0.98% on 4-22, -0.99% on 4-21, +2.43% on 4-20, -1.64% on 4-17, -2.54% on 4-16, -0.92% on 4-15, +1.21% on 4-14, +1.47% on 4-13, -7.52% on 4-9, -0.76% on 4-8, +0.44% on 4-7, +0.14% on 4-6, -0.67% 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.
Additionally, the collapse of the S & P 500 wall of worry (SPX versus VIX) recently, see http://finance.yahoo.com/q/ta?s=^GSPC&t=3m&l=off&z=l&q=c&p=&a=p12,p12,fs,p12,fs,w14&c=^vix, points to a collapse in SPX soon. Note that when VIX substantially outperforms SPX for a while, substantial SPX strength tends to occur shortly thereafter (since 3-6-09 in this case), and, vice versa.
Also, the S & P 500 (SPX) stochastics are extremely overbought, at 97.82 and 91.68, and, Williams %R is at -0.80, very close to the overbought maximum extreme at 0 (-100 is an oversold extreme).
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
The Trade the Cycles system doesn't flash an important sell signal until the S & P 500 (SPX) uptrend line/channel since mid/late March clearly/decisively breaks down, see http://stockcharts.com/charts/gallery.html?%24spx. However, given the extremely overbought condition, the huge Wave 5 spike move recently, the other factors discussed above, and, caution is obviously in order.
The longer the lag time between when the super bearish broad market Walmart (WMT) Lead Indicator (data beginning on 3-6-09) "kicks in," from when it originally became extremely bearish, the more important the upcoming cycle high will tend to be, because, the larger, longer, more important the upcycle or downcycle, the longer the lag time tends to be before an important indicator "kicks in," and, the expected action (severe weakness in this case) begins.
Therefore, the long lag time recently (recent weeks) points to an important cycle high occurring soon, and, jives with it being a likely countertrend Wave B type cycle high, probably Wave B up of the intermediate term downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx.
I'm long FAZ (3x Finance Bear ETF) overnight, purchased on 4-22 at 8.85.
The XOM (Exxon Mobil) Lead Indicator was an extremely bearish -2.03% versus the XOI today/on 5-6, +0.33% on 5-5, -2.76% on 5-4, -1.30% on 5-1, -0.45% on 4-30, -0.35% on 4-29, +0.92% on 4-28, +1.44% on 4-27, -1.72% on 4-24, -1.57% on 4-23, -0.98% on 4-22, -0.23% on 4-21, +2.60% on 4-20, -1.00% on 4-17, -1.62% on 4-16, +0.95% on 4-15, +0.96% on 4-14, -1.90% on 4-13, -0.66% on 4-9, -0.47% on 4-8, +0.61% on 4-7, +1.71% on 4-6, -0.57% on 4-3, -2.70% on 4-2, -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.
Note that reliable broad market Lead Indicator Walmart (WMT) put in a countertrend Wave B Minor Intermediate Term Cycle High in very early April, see http://stockcharts.com/charts/gallery.html?wmt.
SPX's (S & P 500) countertrend Wave B Minor Intermediate Term Upcycle, that began on 3-6-09, is probably Wave B up of the Intermediate Term Downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx.
WMT has bearish breakaway upside gaps at 51.53, 52.61, 53.43, 53.80 and 55.54, and, has a downside gap at 48.47.
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), has upside gaps at 835.48 (filled), 842.50 (filled), 858.73 (filled), 869.89 (filled), 869.60 (filled), and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) has downside gaps at 903.80, 877.52, 855.16, 825.16, 811.08, 768.54, and, one at 676.53.
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.
FAZ (3x Finance Bear ETF) is a great opportunity to probably make a lot of money now/soon (probably for the next few weeks/months), which is why so many are trading it. Not a recommendation.
Follow my live updates at Twitter!, at http://twitter.com/tradethecycles. Highly recommended. I'm having fun and networking, in addition to microblogging my Trade the Cycles work/system and opining about a variety of subjects. 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 recently. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I opine about other subjects.
GDX/HUI/XAU's short term countertrend Wave B upcycle since 4-17-09 is in Wave 5 up peaking, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see GDX's daily chart. The strength since 4-17-09 is Wave B up of the Wave 2 Intermediate Term Downcycle since 3-26-09 for the XAU (very early April for GDX/HUI).
The five day intraday NEM Lead Indicator closed at super bearish, see http://finance.yahoo.com/q/ta?t=5d&s=NEM&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=^xau, which is a very short term bearish indication.
GDX/HUI/XAU are doing a countertrend Wave B upcycle since 4-17-09 (the NEM Lead Indicator closed at -1.70% versus the XAU today/on 5-6, -0.03% on 5-5, -0.46% on 5-4, -4.10% on 5-1, +1.00% on 4-30, -1.03% on 4-29, -0.56% on 4-28, +2.63% on 4-27, +1.22% on 4-24, -1.75% on 4-23, -1.37% on 4-22, +0.95% on 4-21, -0.02% on 4-20, -0.93% on 4-17, -0.89% on 4-16, -0.03% on 4-15, +0.23% on 4-14, -0.88% on 4-13, +0.18% on 4-9, -1.21% on 4-8, -0.96% on 4-7) of the Wave 2 Intermediate Term Downcycle since 3-26-09 for the XAU (very early April for GDX/HUI), see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see GDX's daily chart.
The GDX/HUI/XAU Wave 1 Intermediate Term Upcycle since late October 2008 peaked on 3-26-09 for the XAU, and, peaked in very early April for GDX/HUI, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see their daily chart.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 33.11 (filled), 29.67, 29.13, 25.41, and 23.23. GDX has very bearish breakaway upside gaps at 34.87 and 34.37 (both filled 5-4), and, NEM has one at 43.89 and one at 41.68 (filled 5-5). NEM has downside gaps at 36.66 (filled 3-17) and TBD, and, has a downside bullish breakaway gap at 40.14 (filled) from 3-19's open.
Gold hit a 5% major buy signal 14 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.
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
Other factors (discussed below) pointing to an imminent important S & P 500 (SPX)/market cycle high are VIX, the super bearish five day (and since 3-6-09) intraday broad market Walmart (WMT) Lead Indicator, and, an extremely overbought condition.
This might be the strongest two month SPX (S & P 500) upcycle ever. Remember that countertrend action tends to be considerably stronger than what normally occurs in most upcycles, because, it's important peaking action.
A likely scenario is that SPX (S & P 500) will peak shortly after filling or failing to fill the upside gap at 934.70, possibly tomorrow (broad market Walmart (WMT) Lead Indicator was an extremely bearish -3.62% versus SPX (S & P 500) today/on 5-6).
One of today's Tweets: "The market's partying like 1999, and, it'll probably end like March 2000. The more gravity defying action, the more severe bust tends to be."
Follow my live updates (the "play by play") at Twitter!, at http://twitter.com/tradethecycles. Highly recommended. I'm having fun and networking, in addition to microblogging my Trade the Cycles work/system and opining about a variety of subjects. I'm tradethecycles at Twitter. Joining is easy, then you follow me by clicking follow. Or, you can simply follow my Twitter web site at http://twitter.com/tradethecycles.
Since 4-21-09 SPX (S & P 500) has done an up down up down up Elliott Wave pattern, with the huge upcycle the past six sessions appearing to be the final Wave 5 blowoff spike move, of the likely countertrend Wave B Minor Intermediate Term upcycle since 3-6-09, see http://stockcharts.com/charts/gallery.html?%24spx, and, is an attempt at filling the upside gap at 934.70.
As long as SPX (S & P 500) peaks below the 1-6-09 943.85 cycle high, see chart two at http://stockcharts.com/charts/gallery.html?%24spx, then, the upcoming cycle high will probably be, until proven otherwise, a countertrend Wave B type cycle high, that's probably Wave B up of the Intermediate Term Downcycle since 1-6-09, to be precise.
Another important factor pointing to an imminent important S & P 500 (SPX)/market cycle high is the super bearish five day intraday broad market Walmart (WMT) Lead Indicator at session's end today 5-6-09, 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, at about -6.50% or more vs the S & P 500, signaling an imminent potentially important cycle high.
Also, the broad market Walmart (WMT) Lead Indicator (data since 3-6-09, when a likely countertrend Wave B Minor Intermediate Term Upcycle began) is super bearish since 3-6-09, at -3.62% versus the S & P 500 today/on 5-6, -0.37% on 5-5, -1.81% on 5-4, -1.23% on 5-1, +0.00% on 4-30, +1.92% on 4-29, +0.19% on 4-28, +2.35% on 4-27, -3.71% on 4-24, -1.19% on 4-23, -0.98% on 4-22, -0.99% on 4-21, +2.43% on 4-20, -1.64% on 4-17, -2.54% on 4-16, -0.92% on 4-15, +1.21% on 4-14, +1.47% on 4-13, -7.52% on 4-9, -0.76% on 4-8, +0.44% on 4-7, +0.14% on 4-6, -0.67% 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.
Additionally, the collapse of the S & P 500 wall of worry (SPX versus VIX) recently, see http://finance.yahoo.com/q/ta?s=^GSPC&t=3m&l=off&z=l&q=c&p=&a=p12,p12,fs,p12,fs,w14&c=^vix, points to a collapse in SPX soon. Note that when VIX substantially outperforms SPX for a while, substantial SPX strength tends to occur shortly thereafter (since 3-6-09 in this case), and, vice versa.
Also, the S & P 500 (SPX) stochastics are extremely overbought, at 97.82 and 91.68, and, Williams %R is at -0.80, very close to the overbought maximum extreme at 0 (-100 is an oversold extreme).
Nothing discussed on this Blog is a recommendation, or, should be construed as investment advice.
The Trade the Cycles system doesn't flash an important sell signal until the S & P 500 (SPX) uptrend line/channel since mid/late March clearly/decisively breaks down, see http://stockcharts.com/charts/gallery.html?%24spx. However, given the extremely overbought condition, the huge Wave 5 spike move recently, the other factors discussed above, and, caution is obviously in order.
The longer the lag time between when the super bearish broad market Walmart (WMT) Lead Indicator (data beginning on 3-6-09) "kicks in," from when it originally became extremely bearish, the more important the upcoming cycle high will tend to be, because, the larger, longer, more important the upcycle or downcycle, the longer the lag time tends to be before an important indicator "kicks in," and, the expected action (severe weakness in this case) begins.
Therefore, the long lag time recently (recent weeks) points to an important cycle high occurring soon, and, jives with it being a likely countertrend Wave B type cycle high, probably Wave B up of the intermediate term downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx.
I'm long FAZ (3x Finance Bear ETF) overnight, purchased on 4-22 at 8.85.
The XOM (Exxon Mobil) Lead Indicator was an extremely bearish -2.03% versus the XOI today/on 5-6, +0.33% on 5-5, -2.76% on 5-4, -1.30% on 5-1, -0.45% on 4-30, -0.35% on 4-29, +0.92% on 4-28, +1.44% on 4-27, -1.72% on 4-24, -1.57% on 4-23, -0.98% on 4-22, -0.23% on 4-21, +2.60% on 4-20, -1.00% on 4-17, -1.62% on 4-16, +0.95% on 4-15, +0.96% on 4-14, -1.90% on 4-13, -0.66% on 4-9, -0.47% on 4-8, +0.61% on 4-7, +1.71% on 4-6, -0.57% on 4-3, -2.70% on 4-2, -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.
Note that reliable broad market Lead Indicator Walmart (WMT) put in a countertrend Wave B Minor Intermediate Term Cycle High in very early April, see http://stockcharts.com/charts/gallery.html?wmt.
SPX's (S & P 500) countertrend Wave B Minor Intermediate Term Upcycle, that began on 3-6-09, is probably Wave B up of the Intermediate Term Downcycle since 1-6-09, see http://stockcharts.com/charts/gallery.html?%24spx.
WMT has bearish breakaway upside gaps at 51.53, 52.61, 53.43, 53.80 and 55.54, and, has a downside gap at 48.47.
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), has upside gaps at 835.48 (filled), 842.50 (filled), 858.73 (filled), 869.89 (filled), 869.60 (filled), and 934.70, see http://stockcharts.com/charts/gallery.html?%24spx.
SPX (S & P 500) has downside gaps at 903.80, 877.52, 855.16, 825.16, 811.08, 768.54, and, one at 676.53.
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.
FAZ (3x Finance Bear ETF) is a great opportunity to probably make a lot of money now/soon (probably for the next few weeks/months), which is why so many are trading it. Not a recommendation.
Follow my live updates at Twitter!, at http://twitter.com/tradethecycles. Highly recommended. I'm having fun and networking, in addition to microblogging my Trade the Cycles work/system and opining about a variety of subjects. 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 recently. I'm going to try to make timely live updates at Twitter and make it a real time extension of this Blog. Also, I opine about other subjects.
GDX/HUI/XAU's short term countertrend Wave B upcycle since 4-17-09 is in Wave 5 up peaking, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see GDX's daily chart. The strength since 4-17-09 is Wave B up of the Wave 2 Intermediate Term Downcycle since 3-26-09 for the XAU (very early April for GDX/HUI).
The five day intraday NEM Lead Indicator closed at super bearish, see http://finance.yahoo.com/q/ta?t=5d&s=NEM&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=^xau, which is a very short term bearish indication.
GDX/HUI/XAU are doing a countertrend Wave B upcycle since 4-17-09 (the NEM Lead Indicator closed at -1.70% versus the XAU today/on 5-6, -0.03% on 5-5, -0.46% on 5-4, -4.10% on 5-1, +1.00% on 4-30, -1.03% on 4-29, -0.56% on 4-28, +2.63% on 4-27, +1.22% on 4-24, -1.75% on 4-23, -1.37% on 4-22, +0.95% on 4-21, -0.02% on 4-20, -0.93% on 4-17, -0.89% on 4-16, -0.03% on 4-15, +0.23% on 4-14, -0.88% on 4-13, +0.18% on 4-9, -1.21% on 4-8, -0.96% on 4-7) of the Wave 2 Intermediate Term Downcycle since 3-26-09 for the XAU (very early April for GDX/HUI), see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see GDX's daily chart.
The GDX/HUI/XAU Wave 1 Intermediate Term Upcycle since late October 2008 peaked on 3-26-09 for the XAU, and, peaked in very early April for GDX/HUI, see the XAU at http://stockcharts.com/charts/gallery.html?%24xau. For GDX/HUI, see their daily chart.
GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) has downside gaps at 33.11 (filled), 29.67, 29.13, 25.41, and 23.23. GDX has very bearish breakaway upside gaps at 34.87 and 34.37 (both filled 5-4), and, NEM has one at 43.89 and one at 41.68 (filled 5-5). NEM has downside gaps at 36.66 (filled 3-17) and TBD, and, has a downside bullish breakaway gap at 40.14 (filled) from 3-19's open.
Gold hit a 5% major buy signal 14 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.
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, TAN, XAU, XOI, XOM
posted by Joe Ferrazzano at
2:08 PM
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