The HUI has pushed a bit higher but corrections can slow down any bullish phase. The important wave position happened in late 2015 and very little matters until the counter-rally to the “A” wave in Primary degree, is fulfilled. It took a while but in 2018 the HUI bottomed and looked back only once so far. More big corrections should happen once this anticipated 5 wave run is finished, which should be a wave 4.
Sure, many were bullish for the last 3 years and they will remain bullish even if the HUI hit 500 again. We are not in some super bull market that will send the HUI index to the moon, but more like a huge bear market rally. Very few analysts understand how big bear market rallies can be and it’s not the lame conventional move of 20% from the last bottom.
Would a HUI move from 211 to 500 be a true bull market or just a big bear market rally? We do have the conventional description of higher lows which is the sign of a bullish phase but any large degree Elliott Wave bear market rally will do the exact same thing.
There is nothing wrong with being long in an Elliott Wave bear market rally as they can produce massive “C” wave bullish phases, but also when the 5th wave is being played-out the decision to stay or get out will have to be made.
GDX will behave much like the HUI and the HUI is starting to get expensive to gold again. This morning the Gold/Hui ratio was 6.75 which is the most expensive calculation I have recorded since April 1, 2018.
I expect this ratio to become more extreme but not without any corrections.