HUI, Gold Stock Index Review: Bull Trap In Gold Stocks?




This HUI gold stock index has soared in the first week of June, which helps to confirm that the previous pattern was a 3 wave correction. The trouble with being very bullish anymore is because this HUI move was very straight up, and therefore can’t be trusted.  I have not heard any obvious gold stock insider selling so at this time my bearish scenario is a lone wolf forecast.  The June rally contains a 3 wave pattern at this time, so this can fit well into a diagonal type 5th wave.  The HUI also tapped the 250 price level on Friday, and then immediately backed off a bit. 

The arrows show where all the gaps are, and I am sure all of them will get closed off in due time.  If this year’s move has all been just a fake, then this sure would surprise all the contrarian gold stock holders. If no real gold stock insider selling news is published, then there is no certain way of knowing if a strong top has just happened. This is where pattern recognition is a very important thing, as the price will just not do it.  I sure am not going to spew out a bunch of garbage, where the HUI has to hold at a certain price level to remain bullish. 

Hopefully it will not take too long to start to show the gold stocks true colors, as I think this run has gone on long enough. Nothing is worse, then selling out too early in a bull market, but a potential fake bull market, would be an entirely different matter.  


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