I’m seeing some signs that gold mining stocks may have just printed an undercut bottom.
40 thoughts on “WAS THAT THE BOTTOM?”
Chris
Gary. Thanks. Great input about EW 3 up wave. Yes, if so, this 5 wave could mark Golds first major up wave. And that could really enhanced the likelihood of a gold major bottom. Of course, if gold couldn’t complete 5 wave, but does an ABC, then once again, gold is gonna fail.
zkotpen
January 24, July 24
wugga wugga, same same?
Galen
Once again your analysis proves how irrational the price of miners have become. The turn about has to be close. Thanks
Mark
Gary,
the chart of Gold/xau is insane…really…either we will have the bankruptcy of many miners or we have in front of us one of the most incredible opportunity to make money of our entire life.
What do you think about the giant H&S on Miners many analysts are pointing out?
GaryPost author
It would only be appropriate that a bear market that was created by manipulating the paper futures market would end with one last manipulation of the mining stocks.
We shall see how next week plays out.
David
price action will determine gold and miner bottomed or not, a simple view is gdx is going up over $15 next week. that is very posible to show for the bottom already formation.
Jacob 2
We keep on thinking this is the bottom then it rolls over and goes lower. How many time do we not learn the lesson hold only to get obliterated once again. Of course one of these times it will be different. Perhaps, we are there. However, unless the miners see some serious institutional money inflows and very soon, as in next week, I fear this to be the likely scenario once again. Gold 850 anyone? (That’s the H&S P.O. I’m told).
GaryPost author
At the moment I’m just looking for an intermediate degree rally. One that pushes the weekly stochastics back to overbought levels. Just a bear market rally. But if we get three rising daily cycles then we will have confirmation that the bear is over.
Mark
Gary,
maybe I’m wrong but that stochastic indicator should probably first reach oversold territory than overbought…..
I do not see a head & shoulders on the price of gold . There is a head & shoulder don both gdx & gdxj .
Gdx ‘s would take us to 10.5 -11.5 over the next 2 weeks , about 20% down from here .
Mark
The giant H&S in on Miners charts indeed.
It is almost too good to be true, according various analysts it should break to the downside soon: http://goldtadise.com/?p=360729
bc
GDX weekly candle bar did not support price downside soon. H&S type also can be explained as three bottom. why not. Next week price action will tell us all.
Jay
No bottom until GDX gets to single-digit territory. 🙂
Alexandru Popovici
Miners are on day 3 of a new DC to faill into the final ICL and multi-year cycle low.
As I commented to Paul several days ago, this bounce of GDX towards its DCH will trick many and …so it happens.
Tuesday, day 5, to produce the DCH of GDX.
Miners to resume IC decline after FOCM for 3 more weeks.
GaryPost author
You can see it best if you look at the silver miners. They are still trying to print a final ICL. They may have done it on Wednesday or it may come this week.
Atkjhi
Gary
It looked like silver was breaking out early Friday but they just slammed it right back down. It’s literally just press a button and PMs go down. Not sure how that game ever ends when there really is nobody on the other side of the trade that can stop it.
Rick
Maybe we are in an Ending Diagonal with a trucated fifth wave …
Divergence and Stoch is rolling over … Let see.
A Dovish Fed can help.
I still need to see huge volume in gdx telling me a bottom has happened, we may see spikes but I can’t flip coins that good. Something else to look at for a long term investment is the midstream mlp, they are trying to bottom after riding oil and ngas down. I will be watching closely as oil bottoms. 1 of the best funds for them is Kayne Anderson kyn. They hold the top companies in this space. Not pushing this at all, just know that it is a good opportunity to be diversified, especially when they are at near bottoms. They pay good dividends that percentage wise will stay if you buy low and the share prices normalize with a oil recovery. In other words you can get a 15 % + return on the share price if bought low at a bottom and you keep making that while you watch the share price double or more when oil recovers to the 80s
victor
I think we should forget oil for 80$ for the next 2-3yrs unless inflation start growing ..
tim
all the more reason for a long term play right here, oil bottomed 1st of 09 at $40 and topped 5 yrs later while the midstreams who process and transport oil and gas bottomed about the same and topped about the same. KYN for example paid a 16% return on the share price of $12 at the bottom in 09 and topped at $41 while still paying you a little better on your original investment as they increased dividends each year that put it over the 16% at the top and then a share price gain from $12 to $41. Today they are back to $12 and paying a new investor $16+. You just have to remember to sell at the next top in oil and it will happen.
Growth will rise nicely in the midstream business as the exports kick in.
Yes, i agree. Gold , if it wants to rally, after fomc meeting.
zkotpen
Alex P,
Glad to see you got out of that gold short — though, as I suggested, you could’da done so with a small profit when gold drops to the lower trendline in the fake-out leading up to FOMC minutes.
😉
klo
Great to see all the doubters. Makes me think Gary’s analysis is right on. Last week was imo the gift of the decade. Buying miners esp silver and nugt on Wed and Thu last. Ok bear show it to us or is the bull in charge?!
The comments on other sights generally show disdain and arrogance on the bear side. This is not technical or scientific but I have been in this market since year 2000 and the comments are at the extreme on the pendulum. I think the turn is here or very close. Really nice work Gary. Thank you.
Bill J.
Again, a reminder that DXY registered its “monthly hangman” in Dec. Therefore, a follow-through (if any ) needs to happen this month. Otherwise, the hangman bearish signal would have to be a fake one.
Given that USD has gone no-where on month-to-date basis, a follow-through means a potentially big shakeup on the DXY index this coming week…unless of course if the monthly bearish candlestick in Dec is to be invalided with no follow-through at all…
Brace for a real action next week folks, either way ????
The volume does not seem to support a miners bottom Dec 7 or Dec 21st. ?
Bill J.
How do we judge from the volume point of view? GDX had a weekly volume in excess of 500m shares i.e. average of 100m shares) done in the 1st week of Nov 2014. That marked the bottom of the short-term cycle that fueled a 12-week rally. However, it wasn’t a bottom on hindsight despite a sizable volume.
Therefore, i think volume needs to be closely analyzed with price being the primary indicator, i.e. price first, volume second and other indicators being third.
Bill J.
Looking at Nikkei225 & Hang Seng Index (weekly) candlestick, the chances of these markets testing last week’s low are pretty high. To confirm that equities have bottomed last week, last week’s low must not be breached!
We shall see…???
Chris
Nice rally in gold. Even though I am heavy into gold, I still have my doubts that it will breakout before fomc, if it were to breakout.
Below are the charts I provided late last week of possible bottom. Let’s see.
1. Gold did not breach its previous important swing low during this impulse drop.
Every time the pm shares show any sign of bottoming you call the “end”, you see signs…….. I guess when the reversal finally happens, you can say “I CALLED IT!!!!”.
GaryPost author
I’m just looking for an intermediate rally at this point, but this deep into an almost 5 year bear market with juniors down over 90% every intermediate bottom has to be given the benefit of the doubt.
That’s the problem with big bear markets. The longer they go on the more people distrust every rally. When in fact it should be the other way around. The longer they last the more one should expect every intermediate bottom will be the “final” bottom.
Alexandru Popovici
Hello, Z!
I am neither glad nor unhappy.
I only feel bored from toe to hair tip with this market! 🙁
In one month from now I will “celebrate” one year since I am out of the stock market … I’ve had just some pilot stock trades in November and now in January and some tentative moves in gold and treasuries but these have not counted.
Some veeery boooring 12 months!
And I do not see any stock market bottoming until autumn while charging long on gold is off for me until I see USX topping.
How do you feel, Z ?
zkotpen
Howdy Alex!
Feeling great! In early December, I mentioned that I had developed some new technical settings using 200 periods to complement my usual shorter sample sizes, and that they had backtested quite well. But as you know, backtesting is one thing; real time is another, and practical use is still another. I’ve been taking advantage of the complex, sideways price action in metals to work this technical approach. The price move has been really difficult and challenging — great for putting my technical approach to the test.
Wish I had thought this when I first got into trading. A lot of people lose money because of bias. A lot of people also lose money because of lack of preparation.
You know what my model has predicted since December: That the current sideways consolidation in metals is of the same nature, and of the same degree, as the move from mid-March to mid-May of 2015. Likewise, it should result in a final move down in an ending diagonal that began in 2014, and that move down is predictable to an actionable degree, to be followed by a bear market rally of larger degree — Elliott Wave theory suggests a target in the 1300s for gold, mid to high 20’s for GDX.
On an even larger time frame, that model contextualizes the 2011 all time high in gold within the 200 month SMA, whereas that peak looks like an aberration within 200 week and 200 day timeframes. Though it seems kinda crazy, I believe that gold needs to test the 200 month SMA at some point, though my weekly and daily analysis says that test would be AFTER the big bear market rally.
First back testing, then beta testing. Next up: Finding a backer or source of funding, then putting skin in the game. Then writing a book about it.
But you know, I’m a weird, eclectic Economist — I <3 this stuff!
Jecky chang
In 2 weeks in china starts week long holiday and chinese traders may move to safe haven in gold until end of the lunar NY holiday, since global SM in tormoil. Maybe
Alexandru Popovici
What you are doing there, Z, is very complex. I congratulate you for having discovered a new trading system! That places you beyond eclecticism into creational spectrum.
I personally haven’t been able to cross that border [yet]: I am simply a Livermore-Darvas-ONeil disciple with an additional setup of cycle analysis and Van Tharp rigor. But I feel comfortable with that even though I have to endure times as boring as these.
But these kind of markets are excellent for you, Z, to test your creation.
zkotpen
Cheers Alex — regardless of how things turn out for me and my style of TA vis à vis more classic approaches, one thing is a CERTAINTY:
First back testing, then beta testing.
Only AFTER your trading approach has passed both of these tests should you ever put money at risk!
GaryPost author
Miners are potentially forming a weekly swing (we won’t know for sure until Friday’s close) on week 20 of their intermediate cycle.
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Gary. Thanks. Great input about EW 3 up wave. Yes, if so, this 5 wave could mark Golds first major up wave. And that could really enhanced the likelihood of a gold major bottom. Of course, if gold couldn’t complete 5 wave, but does an ABC, then once again, gold is gonna fail.
January 24, July 24
wugga wugga, same same?
Once again your analysis proves how irrational the price of miners have become. The turn about has to be close. Thanks
Gary,
the chart of Gold/xau is insane…really…either we will have the bankruptcy of many miners or we have in front of us one of the most incredible opportunity to make money of our entire life.
What do you think about the giant H&S on Miners many analysts are pointing out?
It would only be appropriate that a bear market that was created by manipulating the paper futures market would end with one last manipulation of the mining stocks.
We shall see how next week plays out.
price action will determine gold and miner bottomed or not, a simple view is gdx is going up over $15 next week. that is very posible to show for the bottom already formation.
We keep on thinking this is the bottom then it rolls over and goes lower. How many time do we not learn the lesson hold only to get obliterated once again. Of course one of these times it will be different. Perhaps, we are there. However, unless the miners see some serious institutional money inflows and very soon, as in next week, I fear this to be the likely scenario once again. Gold 850 anyone? (That’s the H&S P.O. I’m told).
At the moment I’m just looking for an intermediate degree rally. One that pushes the weekly stochastics back to overbought levels. Just a bear market rally. But if we get three rising daily cycles then we will have confirmation that the bear is over.
Gary,
maybe I’m wrong but that stochastic indicator should probably first reach oversold territory than overbought…..
I do not see a head & shoulders on the price of gold . There is a head & shoulder don both gdx & gdxj .
Gdx ‘s would take us to 10.5 -11.5 over the next 2 weeks , about 20% down from here .
The giant H&S in on Miners charts indeed.
It is almost too good to be true, according various analysts it should break to the downside soon:
http://goldtadise.com/?p=360729
GDX weekly candle bar did not support price downside soon. H&S type also can be explained as three bottom. why not. Next week price action will tell us all.
No bottom until GDX gets to single-digit territory. 🙂
Miners are on day 3 of a new DC to faill into the final ICL and multi-year cycle low.
As I commented to Paul several days ago, this bounce of GDX towards its DCH will trick many and …so it happens.
Gary, good comment!!
Weekly Outlook: January 25 – 29
https://sasafuturestrading.wordpress.com/
Tuesday, day 5, to produce the DCH of GDX.
Miners to resume IC decline after FOCM for 3 more weeks.
You can see it best if you look at the silver miners. They are still trying to print a final ICL. They may have done it on Wednesday or it may come this week.
Gary
It looked like silver was breaking out early Friday but they just slammed it right back down. It’s literally just press a button and PMs go down. Not sure how that game ever ends when there really is nobody on the other side of the trade that can stop it.
Maybe we are in an Ending Diagonal with a trucated fifth wave …
Divergence and Stoch is rolling over … Let see.
A Dovish Fed can help.
https://www.dropbox.com/s/wpc5jx15d1h08xb/HUI.jpg?dl=0
I still need to see huge volume in gdx telling me a bottom has happened, we may see spikes but I can’t flip coins that good. Something else to look at for a long term investment is the midstream mlp, they are trying to bottom after riding oil and ngas down. I will be watching closely as oil bottoms. 1 of the best funds for them is Kayne Anderson kyn. They hold the top companies in this space. Not pushing this at all, just know that it is a good opportunity to be diversified, especially when they are at near bottoms. They pay good dividends that percentage wise will stay if you buy low and the share prices normalize with a oil recovery. In other words you can get a 15 % + return on the share price if bought low at a bottom and you keep making that while you watch the share price double or more when oil recovers to the 80s
I think we should forget oil for 80$ for the next 2-3yrs unless inflation start growing ..
all the more reason for a long term play right here, oil bottomed 1st of 09 at $40 and topped 5 yrs later while the midstreams who process and transport oil and gas bottomed about the same and topped about the same. KYN for example paid a 16% return on the share price of $12 at the bottom in 09 and topped at $41 while still paying you a little better on your original investment as they increased dividends each year that put it over the 16% at the top and then a share price gain from $12 to $41. Today they are back to $12 and paying a new investor $16+. You just have to remember to sell at the next top in oil and it will happen.
Growth will rise nicely in the midstream business as the exports kick in.
Alexandru,
Where do you see the dow/s&p over the next 2 weeks ?
Thanks,
Walt
No rallies b4 FOMC mtg.
Yes, i agree. Gold , if it wants to rally, after fomc meeting.
Alex P,
Glad to see you got out of that gold short — though, as I suggested, you could’da done so with a small profit when gold drops to the lower trendline in the fake-out leading up to FOMC minutes.
😉
Great to see all the doubters. Makes me think Gary’s analysis is right on. Last week was imo the gift of the decade. Buying miners esp silver and nugt on Wed and Thu last. Ok bear show it to us or is the bull in charge?!
The comments on other sights generally show disdain and arrogance on the bear side. This is not technical or scientific but I have been in this market since year 2000 and the comments are at the extreme on the pendulum. I think the turn is here or very close. Really nice work Gary. Thank you.
Again, a reminder that DXY registered its “monthly hangman” in Dec. Therefore, a follow-through (if any ) needs to happen this month. Otherwise, the hangman bearish signal would have to be a fake one.
Given that USD has gone no-where on month-to-date basis, a follow-through means a potentially big shakeup on the DXY index this coming week…unless of course if the monthly bearish candlestick in Dec is to be invalided with no follow-through at all…
Brace for a real action next week folks, either way ????
The volume does not seem to support a miners bottom Dec 7 or Dec 21st. ?
How do we judge from the volume point of view? GDX had a weekly volume in excess of 500m shares i.e. average of 100m shares) done in the 1st week of Nov 2014. That marked the bottom of the short-term cycle that fueled a 12-week rally. However, it wasn’t a bottom on hindsight despite a sizable volume.
Therefore, i think volume needs to be closely analyzed with price being the primary indicator, i.e. price first, volume second and other indicators being third.
Looking at Nikkei225 & Hang Seng Index (weekly) candlestick, the chances of these markets testing last week’s low are pretty high. To confirm that equities have bottomed last week, last week’s low must not be breached!
We shall see…???
Nice rally in gold. Even though I am heavy into gold, I still have my doubts that it will breakout before fomc, if it were to breakout.
Below are the charts I provided late last week of possible bottom. Let’s see.
1. Gold did not breach its previous important swing low during this impulse drop.
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=M&b=5&g=0&id=p76021720573&a=442277463&r=794&listNum=5
2. Gold in USD, $gold:$usd at crucial 61.8% retracement
http://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24USD&p=M&b=5&g=0&id=p82871498567&a=442279272&r=328&listNum=5
3. Silver at major trendline.
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=M&b=5&g=0&id=p36233877924&a=442260809&r=374&listNum=5
4. Copper at Major trendline.
http://stockcharts.com/h-sc/ui?s=%24COPPER&p=M&b=5&g=0&id=p04182320958&a=442260803&r=591&listNum=5
Every time the pm shares show any sign of bottoming you call the “end”, you see signs…….. I guess when the reversal finally happens, you can say “I CALLED IT!!!!”.
I’m just looking for an intermediate rally at this point, but this deep into an almost 5 year bear market with juniors down over 90% every intermediate bottom has to be given the benefit of the doubt.
That’s the problem with big bear markets. The longer they go on the more people distrust every rally. When in fact it should be the other way around. The longer they last the more one should expect every intermediate bottom will be the “final” bottom.
Hello, Z!
I am neither glad nor unhappy.
I only feel bored from toe to hair tip with this market! 🙁
In one month from now I will “celebrate” one year since I am out of the stock market … I’ve had just some pilot stock trades in November and now in January and some tentative moves in gold and treasuries but these have not counted.
Some veeery boooring 12 months!
And I do not see any stock market bottoming until autumn while charging long on gold is off for me until I see USX topping.
How do you feel, Z ?
Howdy Alex!
Feeling great! In early December, I mentioned that I had developed some new technical settings using 200 periods to complement my usual shorter sample sizes, and that they had backtested quite well. But as you know, backtesting is one thing; real time is another, and practical use is still another. I’ve been taking advantage of the complex, sideways price action in metals to work this technical approach. The price move has been really difficult and challenging — great for putting my technical approach to the test.
Wish I had thought this when I first got into trading. A lot of people lose money because of bias. A lot of people also lose money because of lack of preparation.
You know what my model has predicted since December: That the current sideways consolidation in metals is of the same nature, and of the same degree, as the move from mid-March to mid-May of 2015. Likewise, it should result in a final move down in an ending diagonal that began in 2014, and that move down is predictable to an actionable degree, to be followed by a bear market rally of larger degree — Elliott Wave theory suggests a target in the 1300s for gold, mid to high 20’s for GDX.
On an even larger time frame, that model contextualizes the 2011 all time high in gold within the 200 month SMA, whereas that peak looks like an aberration within 200 week and 200 day timeframes. Though it seems kinda crazy, I believe that gold needs to test the 200 month SMA at some point, though my weekly and daily analysis says that test would be AFTER the big bear market rally.
First back testing, then beta testing. Next up: Finding a backer or source of funding, then putting skin in the game. Then writing a book about it.
But you know, I’m a weird, eclectic Economist — I <3 this stuff!
In 2 weeks in china starts week long holiday and chinese traders may move to safe haven in gold until end of the lunar NY holiday, since global SM in tormoil. Maybe
What you are doing there, Z, is very complex. I congratulate you for having discovered a new trading system! That places you beyond eclecticism into creational spectrum.
I personally haven’t been able to cross that border [yet]: I am simply a Livermore-Darvas-ONeil disciple with an additional setup of cycle analysis and Van Tharp rigor. But I feel comfortable with that even though I have to endure times as boring as these.
But these kind of markets are excellent for you, Z, to test your creation.
Cheers Alex — regardless of how things turn out for me and my style of TA vis à vis more classic approaches, one thing is a CERTAINTY:
First back testing, then beta testing.
Only AFTER your trading approach has passed both of these tests should you ever put money at risk!
Miners are potentially forming a weekly swing (we won’t know for sure until Friday’s close) on week 20 of their intermediate cycle.