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.