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Monthly Digger - July 2006


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@some point, betweeen now and sept the gold market will return to below 600, finishing this correction. the down move from the highs was 23 market days. the high on 7/12 was 20 market days, so there is a good chance the highs for the correction have been seen(this analysis is for xau). for gold the highs were 7/14 and that is 21 market days to the high. good symetry. the picture has not changed for me, november will be very emotional and new forever highs in the 1st quarter of 07. bv is correct, commodities the extensions occur in the 5th wave. i think gold has a long ways to go!!!!! dharma

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another thought, 714 high, 562 low=152. rally high =666-152projected low =514. possibility.?  dharma

 

I get a slightly lower number than you but I am using 730 as a high and 540 as a low. Not much difference I get 490. I plan to buy Gold coins from 580 on down a bit at a time.

 

540 gold? That could put the HUI where - all the way practically back at 260? Can't see the HUI finding a bottom at 300 if 540 gold is in the cards ... ?

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another thought, 714 high, 562 low=152. rally high =666-152projected low =514. possibility.  dharma

 

I get a slightly lower number than you but I am using 730 as a high and 540 as a low. Not much difference I get 490. I plan to buy Gold coins from 580 on down a bit at a time.

 

540 gold? That could put the HUI where - all the way practically back at 260? Can't see the HUI finding a bottom at 300 if 540 gold is in the cards ... ?

 

 

Possible. :mellow:

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I started selling some mining shares today, odds are this is a low !!

 

FWIW, they took my SSRI in single fills, 1700 and 1500 shares. They took my HL that way too. Regardless of price, I'll be selling 40% of my positions in the immediate future.

 

I let LOTs and Lots of profit vanish.

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Point and figure Bear? I'm impressed. Sell here in Silver and a bearish engulfing on record CBOT volume today in the Gold.

 

TFH:

 

How did you draw that silver P&F?

 

It seems to create a box for every 6 and 1/2 cents.

 

I presume it's for very short term trades.

 

The traditional P&F shows support at $9.50 and has a target that would make Prechter salivate, and far too freaking unbelievable.

 

 

Bear I bookmarked the chart off of a Gold Eagle post this weekend. That 3.50 hanging out there is something. :lol:

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I started selling some mining shares today, odds are this is a low !!

 

FWIW, they took my SSRI in single fills, 1700 and 1500 shares.  They took my HL that way too.  Regardless of price, I'll be selling 40% of my positions in the immediate future.

 

I let LOTs and Lots of profit vanish.

 

 

I've seen them take it all and in pieces. Doesn't seem to make much difference past the next few hours I've found. I wouldn't make too much of it. While we had a decent rally off the lows in the HUI this afternoon we just might retest the area of breakdown. Not buying.

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HUI:

 

I'd want to watch 300.

 

It's P&F support and the continuing level of the broken uptrend line.

 

The rally off the May 2005 lows was a clear impulse up.

 

It should correct in an abc pattern.

 

A typical abc is a 5-3-5.

 

This abc appears to have a 3-3 pattern so far.

 

A 3-3-5 is called a "flat". Normally it's a rangebound correction that trades in a rectangle.

 

There are "irregular flats" that are 3-3-5 patterns..

 

It is a 3-3-5 type of triangle. The "a" wave corrects the impulse (i.e. it trades to somewhere close to 61.8%). The "b" wave MORE THAN corrects the "a" wave ( i.e. it WILL exceed a 61.8% correction of "a" and can even surpass the top of the prior impulse). The "c" wave is 5 waves, but is the shortest, and does not reach wave "a"s extreme.

 

That parabolic move, as evidenced by MACD, says the rally from 2000 is not over.

 

It is for this reason that I believe that this is a mere correction in the uptrend and not a collapse.

 

Further, I believe that those waiting for a traditional abc where the "c" wave equals the "a" wave will be left behind on the platform while the train prematurely leaves the station.

 

Despite the hit the miners have taken over the last few days, the metal is now outperforming to the downside. Miners lead in advances and lag in corrections.

 

"Take heart, for this too shall pass".

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The Thornicator and All Things Real:

 

Been going over the Thorns and I have 16 out of 40 (40%) related to commodities, (mining, drilling fabricating etc) giving that area a very high weighting. They are:

 

CELL

CENX

EXP

ACI

BTU

ENER

HLX

GLG

CMC

FTO

UPL

GRP

VLO

RIO

ATI

STLD

 

Only FTO (Frontier Oil Co.) and HLX (Helix Energy) are long. I see that Helix moved to NYSE from the Duck this week so this might have had something to do with this month's manic run-up during "the correction". Anyway, everything else is short.

 

For you PMS freaks, GLG reversed to short at $36 on Monday having been long for 3 weeks from $35. GLG moved from $30 to $40 basically, so the model only caught 10% of the mooove. That's not important to me. Well, it would be if I could devise I system that would do better but so far no success there.

 

On the whole only 5 thorns are long and 35 are short and the Thornicator comes in at a cool -42 (-80{all short} to +80{all long})\.)

 

The stocks can be viewed at:

 

The Thorns

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