2011年5月16日 星期一

BUBBLE UPDATE & FINDING A WINNING STRATEGY [achieve]

The stock markets are setting up for either a choppy consolidation or corrective phase before the euphoria phase begins. The winning strategy I have found uses a combination of cycles, sentiment and some technical indicators.

 https://www.youtube.com/watch?v=xHGB90HM6yM

 Pedestrian:

So here is where we are at today:
Since mid April the Euro has risen roughly 4 cents while Yen/dollars has dropped approximately the same amount and murdered the ardor for gold in the process as it was sold off into a bloody pile of pulp. Given Macrons win in France today we should therefore expect to see the Euro strengthen to the next nearest major resistance line near 1.12 (a minimum target) while the Yen/$ falls back near .86 over the next while.
That implies continued weakness for gold if not deeper outright declines. At least briefly.
Some people have already written that the euro is already fully priced though and the response should be fairly tepid as the market opens which might imply the Yen will also move modestly. The Yen however is moved by the Nikkei so if global stock markets go on a bullish surge higher then gold will definitely suffer as the Nikkei pushes higher.
Well as it turns out the Nikkei is looking pretty strong right now and here is where it gets interesting.
Do you all recall my prediction for Nikkei 20,000?
I have little doubt you forgot. This idea of mine is based on the futures chart naturally which is what I almost always use. So take a look at this Japanese index chart and particularly the two small peaks located in the middle of December 2016 and the early part of January.
http://www.finviz.com/futures_charts.ashx?p=d1&t=NKD
Those two little candles I refer too are not much to look at since those peaks are very small, but they are indeed what I am using to identify the next major Nikkei resistance level from which point I anticipate the stock market will turn down.
And if you are looking at that same chart for the period of December until now you cannot help but notice that the pattern will very definitely become a confirmed expanding wedge (megaphone) once it reaches the point of contact which is almost precisely 20,000.
(Provided the index turns down sharply from that level of course).
Well anyway, the good news is that when Nikkei 20,000 is reached that should be our entry point back into the gold market. As the Nikkei falls (and Yen/$ rises) gold will go back up. How far it moves will really depend on the depth of the market correction that I think is coming. A big correction could be surprising bullish for metals, a modest decline will yield merely modest results.
So as we are just 250 points shy of Nikkei 20,000 as of the Friday close this is worth watching. Our Nikkei index could move that much in a single day and tomorrow might just be when that happens. Happy trading to all. If the Japanese market rises to 20k and reverses I would take that as a very bullish short term buy signal on precious metals.
And very conveniently our precious metals group are badly oversold right now so a bounce is predictable anyway. I just wanted to explain my reasons mechanically for why a bounce could happen and the signs I think you should be watching for.
Kind of funny how that Nikkei 20,000 idea worked out isn’t it? Hilarious actually. At least to me….
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  1. Pedestrian
    The other scenario is that the Nikkei blasts right through 20k and destroys my idea completely as resistance is crushed in which case ignore all of the above and save your sorry gold portfolio because it will be going down like the Titanic.
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    1. GaryPost author
      Maybe a few people stubbornly refused to accept what is happening (an ICL decline) but I think most got the hint. Do you really need to gloat over a few die hard gold bugs?
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      1. Pedestrian
        I wasn’t gloating Gary. Not in the slightest. Only confirming a theory I have mentioned here many times before. But if you need to know, I really have no idea how this will turn out. Whichever way it goes though I hope I will be ready to rise to the challenge.
        I get to gloat if my idea was correct though. Count on that happening.
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      2. Pedestrian
        Anyway, I think you might be reading me wrong. Yes, Gold-bugs piss me off but I am still a hardcore metals enthusiast at heart. Its just the idiocy of some of them and all the hostility they have flung at everyone over the years that sticks in my craw. So I blast them from time to time in retaliation.
        They just don’t get that you need Yin to have Yang and what goes up must also go down. Instead they are infuriated by even a small mention gold might have a fall from time to time as if you swore in church or something!
        Once the simple idea of night and day is accepted though its so much easier to invest in this sector. So let me allow you into my head a little with a chart I have not bothered to link before. And when you see it you will understand exactly what I mean and why its important that gold keeps falling during this summer period.
        What you are looking at is truly a thing of beauty for the gold community.
        It is the Japanese Yen/ dollar chart on a monthly level and that pattern you see is identified as a falling megaphone. And it is indeed a MASSIVE megaphone formation that will most likely complete its final lows process with a double bottom near the .82 level.
        In order to get there the Yen/$ will have to drop at least 7 more cents and during that time gold (and gold mining stock) are going to be smashed to smithereens. But once there the time will be ripe for the bounce that is implied and it should be a real doozy with Yen rising more than 60% over the course of the next few years.
        Should gold similarly rise 60% (or more conveniently a .618 fib) as Yen goes back up then it will eventually peak at almost exactly the same price it last saw in 2011 when 1900 dollars was breached for the first time. So that is my prediction Gary. That gold will double-top within 5 years time exactly where it peaked in 2011 and we get a big nasty gold price crash after that.
        In other words, we NEED the Yen to fall back to .82 or thereabouts in order to have the final bottom on the Yen completed and the sooner we get there the better it will be for the gold bulls in the crowd. Because once yen starts trending back up, gold will follow for many years to come.
        And that’s why I don’t care that gold prices are falling right now. Or that the yen is going down.
        Its just the necessary Yin that will make the Yang happen on time.
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        1. GaryPost author
          You should get your chance to exit and get out of the way when gold bounces out of its DCL. Once price reaches overbought on the 5 day RSI the rally usually rolls over pretty quickly and heads back down during the declining phase of the intermediate cycle .
          So I would advise not getting caught on the slope of hope during the next bounce. It will not be the beginning of the next leg up. It will only clear temporary bearish sentiment and prepare the way for the final leg down into the ICL in June.
  2. Pedestrian
    I just handed you a timing chart on gold with an obvious cycle pattern written all over it. That is a chart neither you nor anyone else on this site has ever discussed and its implications are extremely bullish for gold but you (like most gold bugs) are just too stupid to see its significance.
    You guys just never change. In the decades I have been at this I have never found a way to get through to any of you whether I discuss the positive or negative aspects of metals. It must be something in the DNA of your type.
    Bunch of Neanderthals.


Pedestrian
Is tomorrow the day the market blows through resistance and smashes the last of the stock bears to dust?
http://www.finviz.com/futures_charts.ashx?t=EX&p=m1
It might just be. You do the charting and, draw your own conclusions. First off, find the primary support line at the bottoms located in 2003 and 2009 and when that is done locate the parallel line near the current top which just happens to be identified by the peak of 2007. You will notice in a second that the Eurostoxx index is just a few points shy of topside resistance right now and a breakthrough will be extremely bullish for that market.
It would also signal that gold is about to get smashed again. Sorry to have to tell you.

Pedestrian
Nikkei futures hitting 19,920 this morning. Just 80 points shy of my target. We could have our answer today.
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LiesandDamnLies
It was always going to be a strong day for the Nikkei today. There were public holidays for the last three days of last week so the Nikkei didn’t trade. However the Yen was traded and dropped further in those three days.
Todays action was going to be a catch up. Its currently up 2.44% which is more than I anticipated.
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    1. LiesandDamnLies
      Ped
      In my opinion, after today’s action, I think that the Nikkei will rip through 20000 and head towards 20400- 20700 range before reversing. I also suspect that after my pull back to early July happens that the Nikkei will head into late August/ early Sep to again reach the 20400 – 20700 levels. Forming a short term double top and in the long term triple topping pattern. Yen in a similar reverse pattern.
      That is the near perfect set up for a long fall in the Nikkei and SM stocks across the board. And as a consequence a long bull run in gold.
      Anyway that’s how I’m playing it. Putting my money where my mouth is. My cycle sequence has been working since late Feb.
      Lies
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    2. Yen/dollars has broken below its support line a little while back . Not by much but its not really bullish for gold and most assuredly implies golds declines are not finished yet. So take note and keep an eye on your yen charts for the next while. The day is not over at least. So the close will matter here.
Pedestrian
Yen falls another half percent in the small hours of the morning and is now teetering at the edge of .88 as it makes it known its intention is to keep falling. Gold can hardly be expected to stay above 1220 today as a result and so that’s my expectation as this melt continues to torture the minds of metals enthusiasts. Because declines in the Yen often result in a rise for the Japanese averages it seems obvious that the softening of metals prices won’t relent as long as stock markets keep marching higher. This has become an untradeable market. An interminable and boring waiting game offering little in the way of hope for either bulls or bears. Even the usual analysts seem to have fallen asleep and hardly an article of interest has appeared in the gold space in the past weeks. Just the same old recycled blather that as usual amounts to nothing. Unless we see some kind of market pullback gold looks destined to just keep slowly grinding lower as no impetus is in sight to generate fresh buying power. It is a sorry win-less state of limbo where all our minds are condemned to staring at meaningless chart patterns. If the bugs cannot rise to the occasion, the general public sure won’t get excited. Time to just close up shop until summer has come and gone.

Pedestrian
This silver decline sure kicked the snot out of the COTS record long position. That was 100% predictable and long overdue. And yet some twit analysts kept saying it was going to be different this time and the bullion banks were going to get their arses kicked and see a day of reckoning. Hope never dies does it? Too funny for words. And that massive multi-year cup and handle pattern that some claimed to see on silver has come to naught. Also predictable since silver has been following a mirror pattern, not a falling channel like gold. However in this case silver did break down from its resistance line (established from the peak in 2012 to present). And in the process we got a lower low on a double-top that was extremely negative. You can see this on the COT positioning chart. There is a clear COT double-top that has now broken down and implies that interest in silver could be on the wane for much of the remainder of this year.
http://finviz.com/futures_charts.ashx?t=SI&p=m1


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