Quick HUI Update

Despite the many that are bullish on gold stocks like this HUI index, it has been acting very bearish. There are no fancy bullish wave counts here as I still see this decline having more legs to it.  Since the 2011 peak the bearish line is much longer than any counter rally we’ve had. Who still has the power even today? Gold Bears who else? 🙂

The wedge should tell us more once the bottom bullish trend line gets broken.  Late 2000 was also a major bottom but it was not a 4th wave bottom, so the HUI can stop well short of ever getting there. GDX is also acting like the HUI so the two of them could break to new 2015 record lows.

The Gold/Hui ratio is sitting at 8.11:1 today, with a cheap ratio being below 10:1.

In the end the only thing that matters is that the HUI crashes below 2016 lows and by then others will have joined the bearish party.

I believe that the decline of solar cycle 24 is drawing down gold stock prices as it did in late 2008, so hopefully solar cycle 25 will push gold stock prices back up!  Just like a magnet the solar cycles can attract or repel gold prices and it seems to alternate very well.

1980 and 2011 gold prices repelled from solar cycle peaks. In late 2000 it was the opposite as the gold price was already crushed when solar cycle 23 peaked.

 

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DJIA 2011-2019 Review

I’m a bit behind with my DJIA wave count as it has not pushed to record highs, at least not yet. These moves can frustrate any wave analysts, but ignoring them will not help them go away.

Since the 2018 peak, I had to go back and look for extensions that may have occurred. In this case, it’s the Minor and Minute degrees I extended, much as I did with the Nasdaq and SP500.

I also created a Minor degree 4th wave triangle, which would be a prime price target for some very strong price support in the future.

There are daily trading limits in the index futures, so it’s pretty hard for huge single crashes to develop as they did in 1929 or 1987.

It may still take all of April to play out, but eventually, the ending of Solar Cycle 24 will pull stock prices down, much like what happened at the tail end of 2018.

The Gold/DJIA ratio has changed little and is still around the 20.8:1 range, which is expensive by any stretch of the imagination when compared to the gold price.

 

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US Dollar Intraday Bullish Move Update

In the last few weeks and the turmoil in world events, the US dollar is very close to making new record bullish highs. This 97.100 price range is also producing potential resistance.  Will the USD keep on soaring or will it implode due to all the stories about how Russia, China, and Iran are buying gold to destroy the US dollar!  They can’t be buying gold, or they have stopped buying gold because gold has been crashing as the US dollar is soaring.

I won’t repeat any of the fundamentals as thousands of analysts have got that covered. I look at the COT reports and a month or so ago, the commercial hedgers removed a “Large” amount of long positions, with last weeks positions creating a net short ratio of 48.36:1.  In other words, commercial hedgers are bearish by a wide margin, but yet the USD is still going for record highs.

Looking for a bullish wave count under those conditions is like playing “Elliott Wave Count Chicken”, so how long this bullish push will keep going is a good guess at best.

The vertical spike last night would be enough for me to turn very bearish on the USD, but I can still see bullish wave counts developing.

Gold is reacting to the US dollar rally as expected, but its decline will also stop dead and reverse once the USD starts on a much bigger correction.

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Gold Monthly Chart 1980-2019 Elliott Wave Count Review

It’s always a good idea to go back in chart history to do a complete review. All my Supercycle and Grand Supercycle wave counts I used to have no longer were making sense, so my degree levels eventually ended up at a Cycle degree.

Three-degree levels above and three-degree levels below Cycle degree is what I’m chasing.  All the Minor degree wave positions have not been filled out. They will not make any senses anyway if any Intermediate and Primary degree positions don’t make sense.

Basically, what it means we have to connect all the “Cycle Degree Dots” first before we can ever advance into the next higher degree.

I generally don’t like to use trend lines very often as I think they are very subjective.  The bottom trend line is based on the angle of the top trend line. The bottom trend line is pointing to the $500 price range.

Just so gold investors don’t freak out thinking I’m forecasting $500 gold, you can look ahead with the top trend line and it could be pointing to $3000 gold.

The top gold wave count ended on a very good 5 wave impulse move, blowing its top in 1980 at $850. Every wave analyst on the planet had some degree of a wave 3 top for 1980.  Even before I fully realized that commodities run as giant diagonals I started to apply it to gold.

From 1980 to the 2011 peak all we had was a zigzag. A fricken zigzag lasting 31 years and still only a Primary degree move. A bear market in gold lasting about 20 years was the result of the 1980 gold mania peak.

If we jump to the 1999-2000 gold bottom, gold was considered junk as it seemed that the entire world was trying to dump gold. Then a miracle happened and gold started to rally and never stopped for a good 10-year run.

I use the 30-year cycles in gold from 1920, 1950, 1980, 2011 with 2041 being the next 30-year cycle top. (SC Wave 3)

In late 2011, the gold price started to tumble and most of the wave analysts were looking for the bull market to come back. All the wave counting in the world will not help us if we have no clue what the 2011 peak really was.

It was another gold mania even more insane than 1980,  as $5,000-$10,000 gold forecasts were pretty normal.  Back at the 1980 peak, the gold price forecasts were $2000 or more. The only thing that has changed is the price of the forecasts.

If you believe that the 2011 peak is a wave 3 peak in Cycle degree,  then we can pick out 3 types of corrections that we can have. It’s pretty common Elliott Wave knowledge, that markets can fall back to the previous 4th wave of one lesser degree. The 1980-2000 bear market is not the 4th wave! It’s a “B” wave but they can act much like a 4th wave as well.

I think our present gold market is still in a bearish funk, but it could take a few years for us to see a better picture. The decline of solar cycle 24 is drawing gold prices like a magnet, but gold prices could also get repelled back up with the power of solar cycle 25 behind it. Sure we’ve had a long bearish phase already but history shows us that longer ones can happen.

 

Have a Great Easter!

 

 

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SP500 2011-2019 Weekly Chart Review

This is the weekly chart of the June SP500 contract. Our present 2019 stock rally is about 43 points from breaking out but even it stays at the peak today, I will try my extended wave count.

It was the 2011 bottom that is important as it matched the “Peak Gold Mania” of 2011 as well. The other big event that happened at that time was that solar cycle 24 hit its first peak in September 2011.

Basically, I extended the Minor degree part which makes the 2015-2016 correction a wave 3-4 bear market. Since then this market just doesn’t want to stop, but I think resistance is building up. In the last 15-16 months, we are looking at a potential triple top.

The present top also could produce a “Right Shoulder” which if the SP500 is very bearish, the markets will not blast to another record high.

The hedgers are no help at all as the commercials only have a very small net short position.

On a daily chart, the SP500 is still in a golden cross position, but a good correction can produce a death cross with little effort.

The 4th wave bottom support in late December 2018 is also where the 200-day MA is sitting. In order for the SP500 to hit the 200-day MA again, the entire 2019 bull market must eventually be completely retraced. That would put the SP500 below the 2300 price level.

I use the Gold/SP500 ratio and it is always a good idea to make calculations when the markets approach record highs. The record expensive ratio was 2.41:1, with today’s calculation coming in at 2.28:1.

 

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GDX Bearish Update

I do use trend lines but they can be so subjective that it can make them useless to use.  I draw many different trendlines but I do not post most of them.  In the case for GDX, we have a slightly down sloping trend while gold itself had more of an upward trend, since that June 2016 peak.

From the 2018 September bottom, the bullish move can fit well into a triangle, but it can also fit very well as a diagonal 5 wave sequence.  Even W, X, Y, X, Z would work.  In late February we had a peak after which GDX started a decline that can be part of another set of 5 waves in Minute degree.

Another 1-2 wave has to form after which we could see a huge spike to the downside develop. When that happens then a correction could be finishing and we should expect a huge counter-rally.

Gold has gone nowhere but down as the US dollar soared during the night.  With the holidays and a full moon, it could give a small bullish price move, but otherwise, this GDX decline is far from over.

I do have a small GDX short position out which turned green a few days ago.

The Gold/GDX ratio is at 59.13:1 today which is only a bit cheaper than what it’s been most of this year. The more the Gold/GDX ratio spreads the better, as that would make gold stocks seem cheap again.

Stories that China, Russia, and a few other countries are buying gold sure does not confirm the bearish mood gold is in.  They have to buy gold with US dollars as I’m pretty sure they are not going to use other currencies. They are trying to destroy the US dollar which has all been tired before in 2008!

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Nasdaq Daily Chart Update

The Nasdaq finally created a new world record high today at 7715.  In the next day or so it still could push higher which would make the present spike a bit longer. The longer the spike the better as that usually indicates a longer impending correction.  Correction? It all depends on how big any impending correction will be.

If all this bullish hype is going to continue then we should be just looking for a correction, right?  The other side of the coin is that this bull market is coming to an end at a double top creating a big H&S at the same time.

A temporary correction would just create the “Right Shoulder” but then blast to another new record high.  The 2019 rally was one vertical move as good subdivisions were hard to count out as it’s loaded with diagonal waves.

Easter will be a full moon so by next week it could get very interesting.

Commercials are barley net short so they don’t really confirm any bearish scenario I can come up with, but that also means this market can go in any direction.  All it takes is some “Bad News” from any source in the world and the emotional investors could run for the hills.

Protective sell stops are stacking up below present prices, mostly around the bull market bottoms of corrections.

The Gold/Nasdaq ratio is more of an objective look at stocks if they are cheap or expensive when compared to the US dollar gold cash price.  My record expensive ratio is 6.38:1, today this ratio sits at 6.03:1. The Nasdaq is about as expensive as it has ever been, so it sure would be ripe for a major correction.

 

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Palladium Intraday Bearish Update

This is a 90 min intraday chart with the standard moving averages as well.  Commercials have a heavy net short position which makes chasing a bull market wave count a rather futile endeavor.

There are no daily trading limits in many of the metals so they can crash in huge moves that can surprise many investors/traders.

Commercials are net short on most of these metals which does not bode well for an instant turn around soaring to new world high records.  I would have to do more research on how palladium reacts to the solar cycles, but maybe I can do a quick check by the next time I update palladium again.

Any reaction to the solar cycles can still take a few years until late 2020. I hope to post the progress of the solar cycle more often as they have a huge effect on all aspects of human activity here on earth and in all countries.

Make no mistake about it,  but the war on capitalism is in full swing as many governments and others seek the full shutdown of all fossil fuel use.

Our own government is in full destruction mode as it dictates and forces carbon taxes on all fossil fuel use.

 

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Gold Daily Chart Bearish Update!

Looking at gold from a daily chart perspective can give us an alternate opinion, especially if we are looking at a potential Head&Shoulder pattern.  I just labeled the “Head” while the right shoulder is still declining.

If this picture in gold is really a bullish pattern then, the right shoulder would have to blast much higher and not stop!  Of course, if the 5 wave sequence is close to reality then this decline will keep right on going taking out the $1160 price level.

Gold has a track record of crashing $$180-$200 in any bullish or bearish situation so any price below $1150 would certainly qualify.

The 200-day MA is down at the $1250 price level, but gold would have to travel much further before the death cross on this daily chart happens.

The death cross is much closer in the weekly and monthly charts than it is on this daily chart.

The commercial hedgers are in a very bearish funk as this is a strong net short position. With these numbers, it’s pretty hard for gold to soar to the moon again.  This Friday is a full moon so short term, gold could turn bullish.

When gold soars due to safe-haven buying,  then these moves never last very long as it’s all based on the emotion of “Fear”.

Silver and gold can and do move together, but they do so under different patterns.  In short, the overall bullish pattern in gold is painting us a false scenario, which silver and gold stock ETFs do not confirm.  Just because an asset class goes up does not mean it’s in a real bull market. Bear market rallies can last for years before they implode again.

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US Dollar Intraday Bullish Phase Update.

On the 12th of April, the US dollar index seemed to have made a good bottom which may be the 4th wave of Minuette degree. It could take the rest of the month to play out but the full moon this Friday may change all that.

Looking for a bullish wave count in a world that is trying to kill the US dollar seems futile at best but that’s what markets do, as they act the opposite of what the majority always expect. Against all odds, the USD has turned bullish. Any 5th wave can extend blasting to new record highs and I’m sure we will get a heavy dose of diagonal wave structures as well.

It would be nice to see the USD above 97.700 but that could just be wishful thinking at this time. The commercials are not on the bullish side so any bullish wave count I have technically should not work.

 

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Silver Weekly Chart Bearish Review

As we can see on this silver weekly chart, for the last few years the basic trend has been down while gold’s trend was pointing up. Just because gold has been going up does not mean that gold is in a bull market.

Since the April 2011 peak silver has had many powerful rallies that “All” turned into bear market rallies by retracing the previous bullish move and then proceeding lower.  Silver is only about $1.40 away from a complete retracement of its 2018 bottom which would make it an 8-year bear market still in progress.  All the gold hype is brainwashing us while silver is being ignored on the most part.

Another strong dip below $13.56 would confirm that the big silver bear (Polar Bear) is alive and well.  The silver bear is already 8 years old and it will be important to watch for the next year or so.

The 2011 peak is a 31-year peak counting from 1980. The difference between the 1980 peak and the 2011 peak can hardly be measured. Both were solar cycle peaks, while solar cycle 24 had a secondary peak in 2014.

The solar cycle is what drives the business cycles on earth and silver could remain bearish until solar cycle 24 has ended. This might take until the fall of 2020 to play out.

The commercials added long and short positions, last week, which only changes the open interest as they are still net short.

When I have the moving averages turned on, we already had the Death Cross on the weekly and monthly charts, but not on the daily chart. This just supports any bearish outlook I might have at this stage of the game.

 

 

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Crude Oil Intraday Triple Top!

For the last 3-4 days, WTI crude oil ran into the $64.70 price level about 4 times since the December 2018 bottom. The entire 2019 bullish phase has been choppy and seems to have a slight  “Wedge” shape to it.

Crude oil could still turn into a triangle and we would be heading down to an “E” wave if that was the case.  $63.20 could be a bullish support price level but if the bigger bearish picture is true then $63.20 would just offer temporary support.  One day crude oil can soar and then the next day oil can drop like a rock.  Crude oil has been moving to the point where the analysts are having a tough time trying to figure out the real trend.

Just because some asset class is going up does not mean it automatically is in a new bull market.  Big bear market rallies can do exactly that but to confirm this, crude oil would have to crash well below the $44 price level.  We could have a long wait before that happens.

There are no daily limits on crude oil moves, so when it starts to act bearish it can move with stunning speed and price distance traveled.

The 2008 crash is a prime example of how fast prices can move.

 

The commercials are still net short by a wide margin which tells me the commercial hedgers have a bearish outlook which makes chasing a big bullish wave count a futile endeavor at this stage of the game.

The Crude/Oil ratio sits a bit above 20:1  which it has done only twice in 2019 and all in April.  I call this “Hitting a Gold/Oil price ratio brick wall”. At a 17:1 ratio,  oil has had no problem in crashing in the past but the ratio could still get worse in the short term.

Canada is a prime example of how the “War” on oil is being executed by forcing the “Carbon” tax onto the provinces that don’t want it. Here in BC, we had a big price jump at the pumps which will drive people across the border to get cheap US gas. My friends that drive to work are not happy campers and I’m sure higher gas taxes at the pumps does not increase the demand.

80%  of the world runs on fossil fuels just to keep the lights on, its more like keeping the Internet up and running. 5G and Bitcoin mining requires huge amounts of electricity that solar power can never supply.

 

 

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Gold Intraday Slump Review

I was hoping for a counter-rally move and we finally got one this morning.  Gold peaked last night at $1310 and then proceeded to implode. In order for the April bullish move to remain bullish, gold has to form a very corrective looking pattern before it retraces 100% or more.

The gold price slumping below $1281 would confirm that this April rally was just another bear market rally.  Time is the unknown factor as any move can be fast or slow.  If gold breaks out to a new low it might take until the end of April for this to happen but otherwise, we are at the mercy of the emotional crowd.

Running in and out of gold assets for safe-haven reasons hardly ever lasts very long as those are emotional moves, not logic moves.

Gold also ran into the 50-day MA line at the $1306 price level after which it turned and headed south.  The 200-day MA is at the $1250 price level which is a big drop, with no guarantee that it will get there.

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Solar Cycle #24 And AR2738 Commentary.

The results for March sunspot activity is in.  It takes at least a week into the next month before they can post the previous months results. By the looks of it, March had a small increase in sunspot activity but that activity still belonged to Solar Cycle #24.  We still could see a total of three years where we have maximum spotless days, which could take us to the end to 2020.

2008-2009  was the end of Solar Cycle #23, which correlated with the stock market bear market.  It was the new solar cycle #24 that started in March 2009 that created another super stock bull run.

This has all happened before as solar cycle #23 pushed the 1996-2000 bullish phase of the stock market. Most investors ignore the solar cycles, but they have a better track record of creating stock bull and bear markets than any government policy can.

Every country on this planet lives under the same sun, and China was buying up US assets during solar cycle #24’s advance. The building boom in China at that time is also another example of how solar cycles influence business expansion and contraction.

Having a bearish outlook for the future after solar cycle #25 starts will kill any bearish wave counts we may have at that time, just like what happened in late 2008.

Sunspots come to the surface of the sun to die, and AR2738 is just a couple of days old and still belongs to solar cycle #24. Spaceweather.com is one of the main sites I visit which allows us to see the face of the sun without the need for special glasses to protect your eyes.

Scientists use the solar cycles as they increase or decrease the “drag”  on any structures in low earth orbit like the ISS. Eventually, all space junk will fall to earth due to the solar cycle drag.  There are about 4 countries that have blasted satellite targets in low earth orbit which can produce 20,000 pieces of junk at the same time.

India was the recent country to demo satellite-killing capability which produced a huge amount of space junk endangering the ISS as well. NASA was not happy, to say the least.  If you are an investor then following the solar cycles should be at the top of your list of things to do.

It may take until the end of 2020 before solar cycle #25 starts to crank up and 2020 is also close to the end of a 20-year cycle which contained a complete solar cycle.

There is no guarantee but I will try and update solar cycle progress more frequently.

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Nasdaq Daily Chart Near Record Highs

The Nasdaq is getting close to new record highs which would soon be a double top, as well as an H&S pattern being set up.   I extended the past for now which will allow the Nasdaq to break to new record highs.

Right shoulders would have to break out in a very bullish fashion, but if this is still a diagonal bearish rally then the right shoulder would produce resistance.

Other indices are not this close to breaking out so the Nasdaq would be marching to a different drummer again.

It seems nothing is stopping this bull market at this time, but we also know that “Bad News” can come out of nowhere and blindside all those investors that are bullish.

The COT reports for the Nasdaq are just about even which offers no special insight as to any new direction.

The Gold/Nasdaq ratio has backed off from record-breaking ratios and sits at 5.82:1 this morning.  This is cheaper than the 6.38:1 record established on September 5th, 2018. The Nasdaq is still very expensive when we use gold as money.

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SP500 Daily Chart Review

The market bottomed in December of 2018 and has now been in a bull run that is a bit more than 3 months old.  2940 represents the potential for a huge double top, and a major Head&Shoulder pattern as well.

We have about 60 points to go before the SP500 runs into new record highs. This remains to be seen, in the days or weeks ahead of us. The entire 2019 market rally is very straight with no real corrections in it.

The corrections we did get are diagonal waves and could be an ending to a “C” wave. Now is also a good time to calculate a Gold/SP500 ratio which means little, if we have no database to work with. Not too many take the time to make a few calculations per month, or when faced another potential extreme.

Since September  2018 any 2:41:1 ratio would be expensive when using the gold cash price, this morning the Gold/SP500 ratio was 2.24:1. This is not a record but very close to being very expensive. A cheap Gold/SP500 ratio would be closer to .75:1

Just with those numbers alone, It’s hard to justify looking for another superbull stock market to materialize.

The Golden Cross happen at the 2760 price level which is very bullish, but always lagging in time.  This doesn’t mean that the golded cross will last as the markets can reverse just as easily.

The first Friday of every month jobs report and a full moon could produce another turning so anything can still happen in the short term.

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DJIA, Heading For A Triple Top?

Trying to find a decent wave count has been a challenge, to say the least, and I don’t see it getting any better.  At 26,700 the DJIA is getting near some major resistance, and if the markets have more bullish moves in them, then they could break out to new record highs again.

In the post, I looked for a potential triangle with a very deep “E” wave which still looks like a zigzag to me.   Any zigzag has very good odds that it can get completely retraced, which our present rally is just short of doing.

Last month saw a corrective drop (3 waves) followed by another 3 wave set which can be a small expanded pattern, which doesn’t fit into an “E” wave at this time.

The Gold/DJIA ratio is as expensive as it ever has been, hitting a price brick wall of 20.48:1, from an extreme of 21:1, established in August 2018.

An extreme expensive Gold/DJIA ratio, a triple top, and an inverse wedge or megaphone keep me looking for a bearish move, not some new bullish leg still destined to go to the moon.

If this wave count, lasts all of April I will be surprised as this market sure seems it has no rudder to help stear it.

A 3 month bull market needs a healthy correction or it sure is due one as the March correction isn’t big enough to do it.

 

 

 

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GDX: September 2018-February 2019 Review

Majority of the time we are confronted with multiple choices in any of the wave counts that we can produce, as all of it depends on where we are counting from.

In the case of GDX, I’m just going to talk about one move from September 2019 to February 2019. I labeled the same move as a Minor degree “A-B” sequence.  A triangle in a “B” wave has a finality to it that forces me to look for and ending at least one degree higher, which would be Intermediate degree.

Just as easily as the wave count can fit a triangle, with just a few changes I can also use it as a diagonal set of 5 waves with an ABC1, ABC2, ABC3, ABC4, and ABC5 wave count. That would make GDX a bullish scenario where a correction would happen. The present “D” wave bottom would be the same as the previous 4th wave of one lesser degree, which would be around the $20 price range.

Of course, there is also the “W, X, Y, X, Z” label I can use which is just a glorified triangle.  The most desperate wave count would be to try and force a pure impulse wave count on GDX. This would give as a potential of at least 4 different wave counts, with 2 of them being very bearish and the other 2 being very bullish.

I would love it if we had another bullish setup as I do trade GDX when I can.  If a correction is due then I would like to see a huge spike to the downside which are a bit softer spikes than what we would get in Gold itself.

Many times GDX runs from month end to month end so maybe by the end of April, we will have a new picture.

The Gold/Gdx ratio is at 58.53:1 which is not all that cheap from an extreme of 84:1.

 

 

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Crude Oil Daily Chart Bullish Action Review

The fundamentals regarding crude oil changes as fast as the wind, besides that I bet there isn’t a single analyst that knows what fundamental news made oil rise into last year, and then crash and burn into early 2019.  I sure don’t know as well but the gold/oil ratio sure gave me a clue that it was going to happen.  Even though satellite spying is extremely sophisticated as they can track the floating roofs on storage tanks.

The US has been accused of refined oil product contamination which happened recently in South Korea,  to where they refused shipments.  Of course, they just turned that oil around and sold it to China.

Beside that most fundamentals regarding oil supply and demand can be just pure false news to keep enemies guessing. In today’s world, it is very easy to manipulate the news, so unless you have a Bull Shit Detector App on your smartphone we will never know the facts.

Even though wave counts can be pretty foggy most of the time they still over more “Truth” than fundamental news does.

Yes, oil can go higher but we are at a 20.98:1 Gold/Oil ratio which is the most expensive it’s been since November 2018 when it was at 17.37:1.

Oil seems to love crashing at around 17:1 which it did in the 2014 decline.

Math doesn’t lie only people do, so any gold/oil ratio can supply more objectivity in a world filled with fake news. “Fake News” and “Propaganda” is the same thing, so its not rocket science to see which countries use the most propaganda.

The commercial hedger’s net short positions make the potential for a big bullish move very unlikely, as open interest is also hitting record lows.

There are “No” daily trading limits in crude oil so that does produce some very long free falling type moves. Traders will be piling on the protective sell stops and once they get triggered, there are no daily limits to slow it down.

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US Dollar Daily Chart Bullish Gyrations Update

In bear markets, it gets ugly as all the bad fundamental news become front page blog news. There is also a whole lot less cooperation as deals fall apart or governments make wild moves that reverberate around the world. It’s a mixed bag of news so the fundamentalists are getting conflicting news.

Yet with all that, the US dollar doesn’t want to die but is still making bullish progress. I stayed with my 4th wave bottom but the 5th wave could also be another zigzag. I have a set of overlapping waves that defies description except a diagonal. I have also seen these “C” waves explode and extend that also defies logic but happens regularly.

One reason the USD has not died just yet is that it is in a much bigger bull market than many of us do not understand.  It is also the main reason why gold and silver continue to underperform.

This is last Friday’s USD COT report and something wild did happen that was a rather rare event and that was that the commercial hedgers removed a big amount of long positions when they were net short already.

This turned into a 41.8:1 net short position which is a huge jump I have seen in all the years looking at COT reports.  It also puts my bullish wave count at odds with the commercials,  like I’m playing “Chicken” with who turns first.

I could see it if a big vertical spike was developing, but we’ve only had small spikes since early 2018.

Yes, the USD could make a sudden move south but with this pattern, it’s much harder to tell.

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Hui 2000-2019 Review

After a small bullish move, most analysts will give you a continuation of the trend usually when the trend can reverse and head south.  It’s the top trend line that has to be broken by a wide margin and that has not happened yet.

Last week the HUI and gold stocks started to back off right at the trend line which keeps me looking for the bearish wave counts which may take the rest of the year to find out. Hui has been in a bullish phase since September 2018  and it would have to take a complete retracement taking out the 131 price level.  I have a peak in February 2019 (180) as the secondary high is starting to look like a completed wave 2.

The Gold/Hui ratio isn’t all that bad at 7.6:1 but that doesn’t mean it can’t go back to a 10:1 ratio all the same.

 

I added the Barrons Gold Miner Index this time, as it has more history than most all gold related indices or ETFs out today. For a “Choppiest” pattern rating, I would give it an 8-9 rating out of 10.  It wasn’t until I switched over to diagonal wave counting that this pattern made any sense at all.

All commodities have diagonal wave structures as their core pattern which has been going on since the  Little Ice Age, which I use as my Submillennium Elliott Wave 2 bottom.  Elliott wave counting is not what you think we are seeing but its all about how well we understand the idealized wave count that is most important. Looking for that perfect impulse like they show in the books is futile at best and you will never find them. There are two types of diagonal waves and I have posted both as examples.

There is a 30-year cycle to most commodities with a ± 1-year error rate that still boggles my mind. The long term CRB chart shows this very well with gold doing the same thing but following 5 waves in Cycle degree.

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Gold Intraday Update

Once I looked at the commercial hedger’s positions, there was no doubt in my mind that they are in a bearish mood.

I will add the gold COT report later. They were also just as bearish in silver so I can’t see gold or silver soaring to new record highs just yet. Most of these metals or futures contracts have no daily limit and gold/silver are two more. It is also one of the main reasons why these no limit contracts can free fall.

The death cross on the weekly charts is below us at the $1250 price level, and the $1160 price level will confirm this wild gold move mostly as a bear market rally.

Commercial hedgers removed 25,503 long positions and also added 10,272 to their short side. Combine them together and that is a substantial bearish move. Chasing a bullish wave count under these conditions is futile at best.

 

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Palladium Crash Update!

Finally, Palladium gave up and turn south. I was hoping that this would happen at the $1550 price level but palladium soared about $55 and turned at $1607.

The palladium bears have attacked, and I’m sure bull blood will flow. Right now palladium is sitting at the 50-day-MA. The 200-day MA is far down at the $1150 price level. The big question is, “Is this a short blip and the bulls will return”?

It all depends how big of a price bubble we were at?  The highest price in palladium’s history has just happened and if a Cycle degree correction is due then the above 4th wave will never hold.

Any drop down to the 4th wave would still only be a Minor degree move, but we would need three higher degree levels before a Cycle degree 4th wave crash has completed.

There is also “No” daily trading limit that I could see. Lack of a daily limit virtually allows the price to free fall so a little dip sure can turn into “Big” dip.

Commercial hedgers were net short by a little more than a 2:1 ratio so I expect this ratio to change in the future as commercials turn bullish again.

Palladium has also started to decline before the end of solar cycle #24 which may not end until late 2020. December 2020 is also the end of a 20-year cycle that started in the year 2000.

 

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Gold Intraday Gyrations Update.

You can blame gold’s gyrations on Turkey, if you like.  It sure seemed like the US dollar and the Euro benefited from the lira turmoil.

We did have a bullish phase in March, with only a few days left to go. Watch out for fake April Fool’s news, as the pranksters just love putting out fake news.

Today the media is easily manipulated, more than it ever has in history, and it’s only going to get worse.

The March rally started as a good impulse, but then it fell apart after the “A” wave peak in Subminuette degree. Gold is sitting on the bottom trend line and if the Golden Bears are in control, then this bullish support line will never hold.

If gold slices through the psychological $1300 price level with ease, then that would also help make my bearish case.  $1294 might give us 50%-60% retracement support, then again a very bearish gold price will not care about any support.

Where is the death cross?  I looked at the daily chart and then switched to the weekly chart and at about the $1240 price level gold would have to find support at the 200-day MA line. Even the golden crossings happened at about the same price level, so it will be very interesting when it gets closer. The 200-day MA is only $50-$60 below us and a crash this small is a walk in the park for gold.

 

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SP500 Intraday Gyrations Update

This is the June 2019 contract and the next one will not be until September 2019. The March contract has expired. Right now this pattern fits well with the Nasdaq but the DJIA is marching to a different drum beat as its correction is far from clean.

The big question will be, “Is it just a correction” (Dip) or will it take out (Retrace) the entire bullish move of 2019 ? A bearish move below the 2320 price level would be a complete retracement and help confirm that this bullish mood was just a big bear market rally.  The 2790 price level seems to have importance as the SP500 has wobbled around that number 4 times already.

Of course, if the stock bears are just taking a coffee break before the next attack, then this 2790 price will never hold.  Right now we also have another small H&S  being set up.

The commercials are net short the SP500 but not by that much. This could make things pretty volatile at least in the short term. Until this market gives us a decent looking correction I will remain bullish,  even though the markets could still go higher.

This planet is suffering from a massive overdose of debt and corruption that is not going to get fixed this year, or next year, or the next! 🙂  Solar cycle #25 will come to the rescue, but that might not happen until late 2020!

 

 

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Nasdaq Intraday Buy On The Dip?

In my opinion, buying into anything that has gone vertical will turn into a disaster because we don’t know how big any dip is going to be. Everybody on the planet thinks this market is going to soar and maybe it will.

If this market is still going to add another super leg to it, then this market has to show or develop something that can clearly work as a correction. That is always a tough call since nothing screws up a wave count worse than another diagonal decline.

So far the Nasdaq has made its last dash to the upside a day after the full moon has arrived which doesn’t happen too often.  March is always a good turning month and we have about 6 trading days left before the end of the month.

If this decline keeps going then the chances get dramatically reduced that a new record high is going to happen in the next week.

The Gold/Nasdaq ratio is at 5.76:1, which is down from 6.38:1 and still nowhere in being cheap when compared to gold.

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Euro Weekly Chart Review

The Euro took a dip during the night further confirming a bearish mindset. I’m not exactly happy with this wave count as there is a bit of conflict here as the COT reports still have commercials being net long. Any big changes in COT positions are not posted yet. It takes the Saturday to look it all over for any changes. The USD acted bullish at the same time and gold pushed to $1320 before it backed off.

This short term Euro plunge could lead into a long spike which increases the chances a longer reversal is comming.

During the 2018 bearish phase, the Euro was extremely choppy which are classic diagonal wave structures, and they are still acting that way.

The golden cross is still in effect but that may not last too much longer after the 200-day MA gets sliced in two.

Brexit woes continue and survival of the Eurozone is also at risk as democratic countries are under constant threat of cyber attacks and debt traps.

Even though the Euro looks very bearish we should be very vigil for an unxepected reversal.

 

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Mini-SP500 Weekly Chart Review

While the majority of investors are pushing the SP500 higher, I’m building the bearish picture.  Most of the bearish pictures I can draw do have multiple choices most of the time. 8 choices would be normal and constantly eliminating anything that will not fit is the name of the game.

A near vertical move with barely a correction could work well as part of a wave 1 pattern and the mainstream analysts are foaming at the mouth in how bullish this setup is.  To confirm the bullish scenario the SP500 would have to continue to soar to much higher price levels, otherwise, we are being blinded by a bunch of smoke and mirrors media news.

There are lots of bearish moves just like this and most of them were fully retraced.  This weekly chart has pushed the SP500 past the 50-day MA, with the 200-day MA still being far below present prices.  The short story on that is that the death cross on this weekly chart is in our future as we are still under the influence of a golden cross that happened in 2009-2010.

Price wise the SP500 must crash well below any support we see and that is before the 200-day MA gets hit.

I’m sure that will happen as flogging a tired stock bull will eventually just piss it off and they could flee in all directions except up.

Commercial traders are not that skewed to the bearish side but bearish all the same.  This also tells me that their positions can change rapidly which will happen once the SP500 gets into another oversold condition.

The Gold/SP500 ratio tells us another story as this morning it was 2.16:1.  We are still very close to a record Gold/SP500 ratio high, so there is nothing that I would consider cheap when compared to the gold price.  In order for the SP500 to become cheap again we need to go below a potential 1:1 ratio or even lower.

 

 

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T-Bonds Bullish To the Bone! Weekly Chart Review.

The Fed has pretty well said that no more rate increases will happen in 2019.  Everybody on the planet knows about it and investors loved it by buying stocks.  All this is fine and dandy but when they stop rate increases, a recession usually follows. There is no way that the world will escape a recession and China is leading the pack. T-Bonds have been in a bull market since 1981. Sure we had major Bond crashes in the past but T-Bonds charged higher after each correction/crash.

I counted out the top as an expanded pattern this time but the end result should be the same as T-Bonds will charge to new record highs once again.

All the commercial hedgers are still net long across many different maturities so it is futile to look for the great bond crash that many experts expect.

There still are different choices for wave count I can have as connecting zigzags is the name of the game in the T-bond pattern.  Over 36 years of a choppy diagonal wave structure and its still bullish.

The odds that 1982 was a Supercycle degree wave 2 bottom is hard to understand by most, but T-Bonds also had a 120-year bear market which might even be harder to understand. ( Zigzag from about 1861 to 1982) 30-60 and 90-year cycles are also all part of it.

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Shanghai Composite Index (INDEX)

This is the chart that tracks companies on the Shanghai index. This is the S&P created index and for now, is the best I can track the Shanghai index with.  I’m convinced that any fundamental news that comes from  China is controlled by China’s highly efficient propaganda machine.

The fundamentals in China are far worse than anything you may have been reading. It’s not rocket science but the Chinese economy is slowing much faster than we think. China is a nation of zombie, companies, banks, and cities. I could go on and on but the short version is that China is all built on debt, and so far has broken all records making the 2008 crisis seem like a walk in the park.

The peak in 2008 matches a major peak in most of the commodities, which I think is wave 3 in Cycle degree. The bear market has been going on for about 10-11 years and I see it far from being finished before any huge bullish phase comes down the pipeline.

Right now the two trend lines put the Shanghai index in no man’s land and that the present rally is just another bear market rally.  There is a very convincing inverted zigzag I see and they usually get completely retraced. Mind you that could still take a few years to play out especially since solar cycle #24 is still running.

I don’t have a big Gold/Shanghai ratio database accumulated, but enough to give us some extreme readings. A low ratio means that the Shanghai index is cheap when compared to gold.

Today this ratio sits at 2.37:1, which is down from an extreme of 6.61:1. In 1996 this ratio was 1.29:1 and the Shanghai may even come back to this cheap ratio.

 

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