HUI Bearish Decline Review

 

hui-oct-7-2016

 

I have a sneaky suspicion that this leg down may give us a bottom, but any Intermediate degree correction  should take much longer to play out. It may be a one of a kind move where it all just rockets, but rarely do I like to have a zigzag correction inside a bigger zigzag.  We can have an opening zigzag for a flat as that is the standard most of the time.  If the HUI blasts up in a very choppy fashion, then we have to be aware that an expanded pattern can happen.

Worse yet, we can get bored with a triangle again, which would still take many months to play out. The ultimate horror show would be a complete retracement. This would be my least favorite outcome, in the shorter term.

There is also a very high probability that gold stocks have  all so crossed over, and have been in  Cycle degree wave 4, since their respective 2011 peaks.

The HUI 2016 low matched the BGMI mega trend line, which  started in 1942,  so in the future, I do believe that low will get exceeded. First, we have got a better handle on our present location, as location, location is the name of the game with the EWP. 

The Gold/Hui ratio has changed little,  so that offers no extra insight, at this time. 

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