XAU, PHLX Gold/Silver Index Review

There is also another listing where this XAU symbol will show up, and that is Goldmoney   A Crypto type money, which is actually backed by real things like gold. I use it as a savings account and can send grams of gold to anyone that also has a Goldmoney account. Goldmoney has  been around for a lot longer than any Crypto currency that I know of.

Besides the XAU, I also looked at the Barrick (ABX) bear market, which is very similar to this XAU gold stock index. 2017 looks like it is a setup for a flat in a potential wave 2 correction.  Overall the gold stock bear market, shows a better defined 5 waves down, which I’m using as a Minor degree 5 waves.  A five year bear market with 5 declining waves, has a nice ring to it, but how it fits into the bigger picture, is still not clear enough. I will not produce mindless little numbers and letters, as many wave counts get trashed on a regular basis. Each broken wave count has to give me back some useful information, that I can use to create a better fit. 

I can adjust the degree level at anytime, but what is important to understand is that Gold stocks are still in a bull market, and in the end can also go vertical. A flat inside a potential wave 2 correction, is a powerful combination as they can explode once the “C” wave position has completed.

 Since this bull market and correction, is about 2 years long, I can see that we may have 2 more years for this to play out.  The more violently it moves up and down,  could also shorten this time frame. The overriding factor is that another leg up is still coming, and we should never waste a bull market in commodities.

As we can see, the gold market is very cyclical, and Rick Rule calls it, “The most cyclical market on the planet”.  The real contrarians know all about this cyclicality and have been making money from it since the 1970’s. 

I don’t use any of the external indicators, that the majority are using as the majority can never win at this game, so why use all their tools?

I use contrarian indicators and one of these is the Gold/XAU ratio. The XAU has been pretty low on my radar screen, but at this time we are at a 15.75:1 Gold/XAU ratio.  An expensive ratio is closer to 5.21:1, (Dec, 2010)so there is lots of room for gold stocks to still move up.