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Monthly Digger - October 2007


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Bollinger Bands:

 

I've posted on what Bollinger said about his bands---compression leads to sharp moves.

 

He denies that expansions should be interpreted as reversal signals. It depends on the degree of expansion and the number of times the Band is hit ---though others argue that when expansions end, the end result is a reversal or a regression beyond the mean to the lower exreme

 

Here's the last several months for XAU.

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i think we are in wave 5 up off the 8/16 lows. i am looking for a move to 710 which is short in time. the miners may have a bigger correction in price as i see a top coming in the broads later this week. the feeling in the market has changed, dips will be bought. i have seen each low since 8/16and including this low as accumulation taking place.

i just one to point out that oscillators in bull markets will always get one out too early . divergences will occur, only to be taken out by the next upthrust without much of a correction. if you must trade be advised of this character of bull markets. dharma

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HUI.

 

Wave 2 or wave 5 at one degree of trend lower?

 

Ive posted that I believe we've seen a completed impulse up from the August 16th lows.

 

Dharma and Meta think we've seen 3 waves up and last week's action was the completion of a small wave 4.

 

McHugh posted his long, medium and short term counts at Safehaven.com.

 

His charts for HUI depict my counts.

 

http://www.safehaven.com/article-8561.htm

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well w/this mornings smack down, it looks like wave 5 of whatever this wave is, is over. it was short in time and in price. i think we correct to 710. and on the shares, i think it is steeper. 2-3 weeks of correction, which no matter when and where it ends will be a buying opportunity. dharma

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does anyone care to state a preference for paas or ssri. or other thanks dharma

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From my viewpoint, SSRI is an overwhewlming favourite.

 

MACD is far more bullish. There appears to be a clear impulse up.

 

Monday was an "inside day" for both, so the trend will be dictated Tuesday.

 

PAAS has an overlapping pattern. It could be a series of 1's and 2's setting up a powerful 3rd of a third, but I don't like overlaps. It also has a megaphone top (reverse symmetrical triangle), suggesting indecision rather than bullishness. MACD is weaker, so it is trending with less vigor.

 

Again, I think the dips should be bought---but Silver's chart is far less decisive than Gold's. I'd hold off on Silver.

 

Incidentally, after I looked at the candlestick charts, I looked at the daily P&F's. They tell a whole story on why SSRI is more bullish than PAAS.

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PAAS:

 

There's too much happening in PAAS.

 

It could be a small head and shoulders if volume picks up on a decline.

 

If volume diminishes it could be a bullish flag formation. I don't trust flags that exceed fib 3, 5, or 8 days--and this is pretty long in the tooth for what I consider to be a "flag"--typically early 4th wave positions in multiple 1 and 2 series.

 

Too scary to think of a current entry in my opinion. $25.50 may be reasonable.

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