Miners and Metals Jul 9

As I mentioned in my last article “Metals and Miners Bull Market Point of Recognition” the Metals and Miners are about to print the point of recognition of a new bull market and price action is showing me that it could be done today. The complete Domed House and 3 Peaks Chart Patterns ended the cyclical bear market and some ratio charts in Metals and Miners were also telling us that the bull market was back several weeks ago. It is important to understand what the charts are telling us in order to jump early in a bull market and not to be left behind. Otherwise jumping in and out at the worst times possible could end up losing money.

On the following chart you can see that GDX, GDXJ and SIL just broke out above the neckline of an Inverse Head and Shoulders Pattern which should launch a new bull market in both Miners and Metals.

MINERS INDEXES JULY 9

On May 30 I bought leveraged positions in Miners and Metals and I intend to keep both my leveraged positions and my conservative positions during all the bull market and to hang on during corrections. Patience is sometime frustrating when there is nothing to do exept watching the market but it is key to bring nice profits. My plan is to trade the intermediate term trend of this new cyclical bull market.

Patience is already well rewarded as the leveraged positions are making nice profits (JNUG,NUGT,USLV,UGLD):

JNUG DAILY CHART UPDATE JULY 9

NUGT DAILY CHART UPDATE JULY 9

USLV DAILY CHART UPDATE JULY 9

UGLD DAILY CHART UPDATE JULY 9

The conservative positions are also making profits and should bring more gains:

GDX GDXJ JULY 9

SLW DAILY UPDATE JULY 9

PAAS DAILY UPDATE JULY 9

AG DAILY UPDATE JULY 9

NEM DAILY UPDATE JULY 9

CDE DAILY UPDATE JULY 9

GPL DAILY UPDATE JULY 9

MUX DAILY UPDATE JULY 9

ASM DAILY UPDATE JULY 9

FSM DAILY UPDATE JULY 9

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US Market Projection Jun 24

I think that the SPX Index is very close to an Intermediate Top at 1968. The Golden Ratio has a target at 1973 for the Leg 2 since March 2009 bottom and in terms of percentage you can see that Leg 2 is almost the double of Leg 1. The risk/reward ratio looks good for short positions on the intermediate term trend.

SPX BULL MARKET JUN 24

As you know I think that the US Market entered a Secular Bull Market since March 2009 bottom and I think that the Dow Jones Index should plunge into a corrective wave 4 very soon. The 7 Year Cycle bottom lets me think that an important low is due in 2016.

DOW JONES PROJECTION  JUN 24

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Metal and Miners Jun 11

It is important to keep in mind that Miners are extremely undervalued. You can see on the charts below that the HUI/GOLD ratio bottomed almost at 2000 level which was a major bottom for the Miners Index.

MINERS GOLD RATIO CHARTS JUN 11 2014

On the following charts you can see that the XAU Index backtested strong supports and the Domed House and Three Peaks Chart Pattern has been entirely completed.

XAU MONTHLY CHART JUN 11 2014

DOMED HOUSE AND THREE PEAKS CHART PATTERN JUN 11 2014

When a market (whatever the asset) is too far from its 65 monthly moving average it returns to the mean. All markets return to the mean.

HUI REGRESSION TO THE MEAN JUN 11 2014

Here you can see on the long term trend that the Gold Metal is very close to strong supports around $1220-$1230 and that Silver could have already bottomed:

GOLD LONG TERM CHANNELS JUN 11 2014

SILVER COPPER WEEKLY CHART JUN 11 2014

The big picture of the Complex Metals is showing bullish consolidation patterns. Corrections often end with Falling Wedge or Expanding Wedge Patterns. You can notice that Silver and Copper are very close to break above the declining trendline resistance from 2011 top. Platinum broke out of a Triangle Pattern and Palladium makes new highs which are also bullish signs for the Complex Metals.

METALS MONTHLY CHARTS UPDATE JUN 11 2014

The Gold/Silver ratio chart is making new lows after breaking down from a Head and Shoulders Pattern, this is also bullish for the Complex Metals.

GOLD SILVER RATIO CHARTS JUN 11 2014

On a closer view you can see that Miners rebounced as expected on the 78.6 Fibonacci level (here you can see how Miners are connected to the 78.6 Fibonacci ratio - Miners: End of the Bear Market?). The Miners Junior Index (GDXJ) is leading as prices already broke above the apex of the Triangle Pattern and also above the declining trendline resistance. On the 60 mn chart you can see that SLV is forming an Expanding Wedge Pattern which could reverse the downtrend as I already mentioned above.

GLD GDX DAILY CHART JUN 11 2014

GOLD SILVER DAILY JUN 11 2014

GDX 60 MN JUN 11

I think that is time for the Miners and the Complex Metals to outperform the SPX Index and that the US Markets are now due for a correction.

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Miners and Metal Update May 4

The first charts are the 10 mn charts of the Miners Index and Junior Miners Index. The HUI is forming a bull flag and GDXJ an Expanding Wedge Pattern. They both rebounced on the neckline of their Inverse Head and Shoulders Patterns. This is a bullish price action.
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MINERS 10 MN CHARTS  MAY 3

The charts below are the 60 mn charts of the HUI Index and GDXJ. You can see that the HUI is probably making a Double Bottom Reversal Pattern and could soon break out of a Bull Flag Pattern. It also took out the red dashed resistance trendline. The Junior Miners have broken out of a Falling Wedge Pattern. These are all bullish price action formations.

HUI 60MN CHARTS MAY 3

The daily charts show the 1 Year Parallel Base Bottom Pattern of the HUI Index and GDXJ. After backtesting the apex of the Triangle Pattern twice and the neckline of the Inverse Head and Shoulders Pattern, prices resume to the upside which is also a bullish sign.
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HUI DAILY CHARTS MAY 3
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Here are the monthly charts of the Miners Index (HUI), the Junior Miners Index (GDXJ) and the Silver Miners Index (SIL). The Junior Miners made a false breakout of the descending channel two months ago but broke out above the channel last week. Some follow through next week would confirm the breakout.
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MINERS INDEXES MONTHLY  CHART MAY 4
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Let’s have a look at the Metal charts. The first one is the 60 mn chart of GLD and SLV. You can see that Gold made a successful backtest of the neckline of an Inverse Head and Shoulders Pattern. Prices resumed to the upside this week and also broke above the declining red dashed resistance trendline. This is a bullish price action.
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Silver broke beneath last December’s low and made a false breakdown to complete an Expanding Wedge Pattern. This bear trap was to run some stops and prices reversed to the upside. An exhaustion decline followed by a reversal higher is a very bullish price action. False breakdown happens over and over in the market as it is an emotion response. An Expanding Wedge Pattern often acts as a reversal pattern but it is not a requirement.
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GLD AND SLV 60 MN CHARTS UPDATE MAY 4
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A break above the high of the previous Daily Cycle high at $1331.40 would validate Apr 24 as a new Intermediate Cycle Low. A break above the last Intermediate Cycle high at $1392.60 would make this Intermediate Cycle right-translated and prices should go up during a minimum of 10 weeks. It would not be a surprise if Gold printed an Intermediate Cycle Low at week 16 (early in the timing band) as the previous one lasted 27 weeks. If prices break below $1268.40 this scenario will not be valid.
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GOLD DAILY CYCLES COUNT MAY 4
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GOLD INTEREMDIATE CYCLE COUNT UPDATE MAY 4
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On a longer timeframe you can see that Silver is also very close to break out of a 3 Years Falling Wedge Pattern. A closing price above $20.50 should valid a breakout. Copper made also a false breakdown of a Triangle Pattern which is a bullish sign for the Complex Metal.
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SILVER  COPPER WEEKLY CHARTS MAY 3
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Palladium is leading the Complex Metal as the breakout occurred 2 months ago. Platinum is still in a Triangle Pattern and I expect a breakout to the upside very soon.
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PALLADIUM PLATINUM WEEKLY CHART UPDATE MAY 4
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The big picture of all the Metals charts is showing that some consolidation patterns are coming to an end very soon. Palladium already broke out and I think that Silver and Copper will be the next ones.
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METALS MONTHLY CHARTS UPDATE MAY  3
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On the chart below you can see that the Yen broke out of a Falling Wedge Pattern and backtested it. (I used a weekly line chart based on weekly close to avoid noise.) The GOLD/CCI ratio chart backtested the lower trendline of the Falling Wedge Pattern and prices just reversed up. Some follow through to the upside should favor a bullish breakout and I believe that it is time for Gold to outperform the Commodities sector.
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GOLD YEN NIKKEI CHART MAY 4
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The next chart shows how the Miners are extremely undervalued. 2001 was a major bottom for the Miners and you can see that the HUI/GOLD ratio chart is almost at the same level as in 2001. As I have often said, Markets are irrational and like to move to extreme levels.
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MINERS GOLD RATIO CHART MAY 4
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The GOLD/XAU chart is showing a possible Head and Shoulders Pattern. Once prices break below the neckline of the Head and Shoulders Pattern, this pattern should play out and Miners will outperform the Gold metal. On the Gold/Silver ratio chart you can see that a Double Top Reversal Pattern could reverse the current uptrend. I also believe that a false breakout of an Inverse Head and Shoulders Pattern occurred last week when Silver prices broke to new lows and then reversed higher.  A false breakout often results in a strong move in the opposite direction. Old highs or lows are often broken fractionally in order for traders to capitulate and think something is wrong, then prices reverse to the opposite side.  Most of the beginners get whipsawed by these emotion response. Once the ratio gets back under the neckline I expect Silver to strongly outperform the Gold metal. Price action and pattern formations are setting up for another leg up.
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GOLD XAU RATIO CHARTS MAY 4
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It is also important to keep in mind the big picture and to watch what is happening when prices are very far from the 65 Monthly Moving Average. The next 20 years charts on different assets are showing that all markets return to the mean. The regression to the mean forces can generate a powerful move which can bring large gains for those who are patient.
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HUI MA 65 REGRESSION TO THE MEAN MAY 4
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I would like to see some follow through to the upside on the HUI/SPX ratio chart. You can see on the big picture that the XAU/SPX  (I use the XAU Index as HUI prices began only in 1996) rebounced right on the blue 30 years support/resistance trendline. The bottom in the Miners Index in December 2013 was made right on this backtest.
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HUI SPX DAILY CHART MAY 4
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XAU SPX BIG PICTURE CHART MAY 4
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Many investors are currently bearish on the Miners and the Metal sector, that is what we need for a bull market to climb “a wall of worry”. The price action shows bullish signs for the moment and I expect prices to resume to the uptrend. The 1 year consolidating price action should lead to trending price action very soon.
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We already made profits in Commodities (Natgas, Coffee, Corn, Soybeans), it is now time to wait patiently the new leg up in the Metal and Miners sectors. In this difficult market situation it is important to diversify the portfolio to make consistent profits and not be exhausted in one sector by a sideways ranging market. Basic principles like position sizing, portfolio diversification and money management are very important.
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Biotech – End of a Bubble?

The performance of the Biotechnology sector has been impressive but as we know, all good things come to an end. Since our original buy the Biotech has had an amazing run up these last two years and the high reward/low risk is now far behind us. On the following charts you can see that the Biotechnology Index (BTK) reached recently important resistances and prices got rejected. These resistances are the upper channels of the long term trend and also of the intermediate term trend.
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BIOTECHNOLOGY INDEX BTK WEEKLY CHART BIG PICTURE MAR 23
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The Biotech iShares Index (IBB) had a parabolic vertical move these last six months and broke down the parabola support last week. I think we should not be surprised by a violent down move after such a bubble.
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IBB BIG PICTURE 2 MAR 23
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All the MC Community has made large profits in this sector and I believe that the last 10% position will be sold very soon with our protective stop on IBB at $244.58.
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IBB WEEKLY CHART MAR 23
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Below is the chart of the short term view on IBB. Last Friday prices broke down an Ascending Wedge Pattern and I expect further downside in the coming days. BTK is showing almost the same pattern with a false breakout of a Rising Wedge Pattern and prices are currently back inside the Wedge Pattern.
 IBB DAILY CHART UPDATE MAR 23
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BIOTECHNOLOGY INDEX BTK CHART DAILY UPDATE MAR 23
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I am seeing some investors coming into this sector which has reached extreme valuation and thus it is time for us to book our last profits and to leave this sector. In my opinion the Biotechnology sector is now due for an important correction before we could see another massive out performance in this sector. Our gains will be invested in an other profitable sector.
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Commodities and Miners Sectors Profits

The Commodities and Miners sectors are bringing us nice profits as expected and the Silver Mining stocks behave particularly well:
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ASM DAILY UPDATE JAN 17
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ASM DAILY UPDATE FEB 14
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GPL DAILY UPDATE JAN 8
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GPL DAILY UPDATE FEB 14
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FSM DAILY UPDATE JAN 8
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FSM DAILY UPDATE FEB 14
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Some triple leveraged ETFs in Miners brought also large profits, such as JNUG (+143%) and NUGT (+75%). I expect Miners to take a breath in the coming days and then to resume to the uptrend.
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The market gave us some important clues already at the beginning of 2014 – some ratio charts were clearly telling us that early January was a buy signal for all the Mining stocks. They also put in perspective that money flow was going to come into the Metal and the Miners sectors:
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HUI USB RATIO CHART BIG PICTURE FEB 20
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INDU GOLD RATIO CHART BIG PICTURE FEB  20
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GOLD XAU RATIO CHART BIG PICTURE FEB  20
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The Silver chart is still on a buy mode for the moment and looks very bullish in my opinion. It is in a process of a Double Bottom Pattern and backtested twice the Base Pattern Neckline:
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SILVER BIG PICTURE FEB 20
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January was also a good opportunity for Commodities, especially for Coffee and Natgas which are already bringing us nice returns (about 60% profits without leveraged position):
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COFFEE MONTHLY UPDATE FEB 20
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COFFEE WEEKLY UPDATE FEB 20
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NATGAS MONTHLY UPDATE FEB  20
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January – A Good Start for Commodities

The Yearly Cycle Low in the Commodities sector was a great buying opportunity for the MC Community and large profits have already been made with Natural Gas and Coffee.
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The short positions from January 23rd in the US market are also making nice profits and I expect more gains in the coming weeks. It was also time to book our profits with selling our last long positions in the Biotechnology sector as it could top at any time now and the MC Leveraged Members had to protect all their gains.
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The Forex traders booked half of their profits on the GBP/CAD pair with about 1 500 pips gains and booked also half of their profits on the GBP/AUD trade with about 2 000 pips profits. The biggest gains were made with the EUR/JPY pair with 3500 pips that we sold end of January.
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I expect other sectors to take off very soon and I will do my best to take the opportunities that the market wants to give us.
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Here are some charts that put in perspective the rhythm of the US Bull Market:
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INDU RHYTHM OF BULL MARKET UPDATE FEB 06
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SPX BIG PICTURE TOPS AND BOTTOMS FEB 06
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NYA SYMMETRY BIG PICTURE FEB 06
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INDU MONTHLY UPDATE LOG CHART FEB 06
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INDU WEEKLY UPDATE FEB 06
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