Category: 3 – Gold Trader

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Weak short term cycle up phases are in danger of early breakdowns  The 13 week cycle is due to remain in a down phase for xxxx (in subscriber version), with a projection of xxxx (in subscriber version). A breakdown below xxxx  would be a bearish sign as it would complete a head and shoulders top pattern with a measured move target of around 1650.

Gold begins December below a couple of key trendlines on the monthly chart. It would need to end the month comfortably above xxxx to reduce the risk of another slide that could carry into the xxxxx. Conversely, if it ends the month above xxxx, that would be a bullish sign.

As for the mining stocks, The short cycle up phase is in danger of an early breakdown, as the 13 week cycle down phase targets xxxx – xxx (in subscriber version).

There are 13 buys and 3 sells from the swing trade screens of 52 gold mining stocks from Tuesday’s action. The rest had no signal. I looked at the charts, and, once again, these buy signals did not impress me as anything more than a dead cat bounce that would probably fizzle out. I decided to wait for better setups before re-entering. This may require some patience.

The last remaining pick from the most recent group hit its stop over the past week and was closed as of the stop price with a loss of 4.4%. Previous picks closed out over the past month had an average gain of 13.4% on an average holding period of  48 calendar days.

See table and charts (subscriber version).

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The strategy and tactics suggestions in this report are for informational and entertainment purposes, and illustrative of one approach. Nothing in this report is meant as personalized investment advice and you should not construe it as such. No representation is made that it is the best approach, will be profitable, or suitable for you.

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This report will be posted on Wednesday morning instead of Tuesday this week. I will be on the road all day. I usually travel by train, where I can get the report done. But with the pandemic raging here in Poland, on this trip I have driven.

Thanks for your patience. See you Wednesday!

Lee

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The 13 week cycle up phase aborted early and the pullback has negated the base breakout. When that happens there’s usually a recovery before a second high that confirms the top. I want to remain optimistic that this will only result in a mild correction/consolidation. As long as the 10-12 month cycle indicators continue to signal an up phase, that’s where I’ll give the benefit of the doubt.

Here’s what the current up to the minute charts say about that (subscriber version).

The HUI mining stock index 6 month cycle is probably topping out. But with the 10-12 month cycle due to stay in an up phase for at least 12 more weeks, I’ll give the benefit of the doubt to the 6 month cycle down phase playing as a consolidation, rather than deep decline. The parameters to watch on that are here. (subscriber version).

Today, there are 2 buys and 13 sells from the swing trade screens of 52 gold mining stocks. This followed 2 buys and 6 sells last week, on the heels of a flood of buy signals the week before. That suggested the possible onset of a new upleg.  Now we’re in a correction.

Could it be something worse? Maybe, so I’m putting stops on all picks, but with a little wiggle room to allow for a little more dipping and then hopefully recovery. I’ll see on the recovery if it’s too weak, and close out picks where the charts call for it. But for now, I want to give them time to allow for recovery.

Current open picks got crushed with the sector as a whole, ending the week with an average gain of just 14.1% on an average holding period of 41 calendar days. That was down from an average gain of  21% with an average holding period of 34 calendar days.

I didn’t see any charts I wanted to add this week. I will stick with existing picks, with stops added as shown on the table.

See table and charts (subscriber version).

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There’s a lot of good news in the cycle projections table (subscriber version). Cycles are in gear to the upside and projections point higher. Now those projections just need to come to fruition. A breakout through xxxx (subscriber version)  should get the ball rolling uphill. Failure to do so within the next couple of weeks would not be good.

Gold made a little progress over the past week but it still needs to clear xxxx (subscriber version) to break out of the trading range. That would essentially end the risk that this year-long consolidation would break down and lead to another downleg in a bear market. Until that upside breakout, the outlook would continue to hold that risk.

On the long term chart of the gold stock index, the neckline of a potential reverse head and shoulders bottom is now at xxxx (subscriber version). Clearing that would be bullish. Failing, and subsequently falling back under xxxx (subscriber version), would be bearish.

Today, there are 24 buys and 2 sells from the swing trade screens of 52 gold mining stocks. This is a big departure from the small numbers of signals in recent weeks, suggesting the possible onset of a new upleg. I expected to see some charts with good setups but I found only two that I liked enough to add to the list, xxxx  and xxxx (subscriber version). The rest were still below big resistance.

Current open picks and one that was stopped out last week, had an average gain of 16.3% and an average holding period of 37 calendar days.  I will drop (xxxx) as of the opening price on Tuesday and track the two new picks also as of the opening price on Tuesday.

See table and charts (subscriber version).

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I don’t know if this issue is affecting all subscribers, but I did hear from one of you that it is, and I found that it’s also affecting me, as I attempt to download the latest Gold Trader report. I have a temporary workaround. Just right click on this link to the report and select open link in new tab (or window). That will open the login screen and you can open as usual. If you are a new subscriber, just type your user name and password, and click enter and the file should open. If it does not, email me from the support form and I’ll send you the file directly.

Sorry for the inconvenience! I’m working on getting this fixed ASAP.

Lee