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Short term cycles in the metal are in up phases, but they’d better get more traction or it could mean more trouble ahead. There’s no confirmation of an upturn in longer cycles yet.
But the screens of the mining stocks offered more positive signs, and I picked 5 charts to put on our swing trade chart pick list this week (subscriber version).
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Gold is at a critical level, testing trend support at xxxx (subscriber version). Updated cycle projections now point to a low of xxxx-xx, with the time window xxxx (subscriber version). The 9-12 month cycle is still in a flat down phase, but it could get much worse if it breaks xxxx (subscriber version).
The Mining Stocks Index (HUI) 9-12 month cycle momentum has reached the level of past lows since 2017 as HUI ticked the bottom of its major downtrend channel. Failure to hold here would be bearish, with the next target xxx-xxx. Conversely an uptick here would be bullish (subscriber version).
Today’s swing trade screen was unqualified good news for the short term outlook. It yielded 25 buy signals and just 1 sell signal, with 26 stocks rendering no new signals. Since there now seems to be a prospect of some recovery, I chose two of the 25 buys to add to the list this week, shown below (subscriber version).
I have included failsafe stoploss prices for those, and adjusted the stop for one of the existing picks.
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I would call today’s big picture cycle screening data for the mining stocks an unqualified disaster, were it not for the fact that the two longer time frames barely dropped below neutral. Moreover, the short term numbers reached a deep sell side extreme. So all is not lost yet. But another down week would crush any hopes of a near term rebound.
When all feels hopeless is usually when a bottom arrives. Right now feels semi hopeless. Maybe not a good thing.
Today’s mining stocks short term swing trade screen yielded 7 buy signals and 7 sell signals, with 38 stocks rendering no new signals. It’s not a recipe for a trouncing, but also not one that inspires confidence. I looked at the charts of the 7 buy signals and the setups promised no more than a dead cat bounce. So I let the dead cats lie.
The last 3 of the picks from August 24 got stopped out last week. The 3 new picks were all losers on the week, but the charts are not broken. At least not yet. There’s still still a reasonable chance of a rebound. I have added stops to those, just below support levels. The table and charts are in the subscriber version.
As for the metal itself, it looks set up for a little bounce here that should carry back to xxxx-xxxx (subscriber version). Then we’ll see. If they hang around up there, it would be a good sign that the worst is over. An immediate rollover would not be.
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The cycle picture is hazy. The table at left (subscriber version) is my best guess. A short term low is due, but at a lower projection. The would-be 13-17 week cycle up phase has gone nowhere, despite a new projection that points higher. If it doesn’t get out of this range soon, it would suggest the possibility of a wicked down phase ahead. If the price holds above the May-August downtrend line as shown on this chart (subscriber version), that would be constructive
HUI gold stock index has been rangebound at the lows for the past month. It still needs to clear xxx (subscriber version) to complete an intermediate term bottom. If successful, it would indicate a new 6 month cycle up phase. The measuring implication would be around xxx (subscriber version).
In the cycle screens of the mining stocks, short term cycles got crushed but the two longer time frames held up ok over the past week. That suggests a pullback in a longer up phase. It tells us to stay the course for now with any longs that haven’t been stopped out, and keep an eye out for new entries.
In the chart picks screen, today’s screen yielded 20 buy signals. There were 4 sell signals. This is a nice balance from a bullish perspective. Last week there were 43 sell signals which was a red flag, but as I wrote then, “The intermediate trend structures still hold the prospect of further gains.” Ditto this week. On reviewing the charts of the stocks with buy signals, I found a few that I liked and will add to the list as buys as of today’s opening print. They are XX, XXX, and XXX. See charts below (subscriber version).
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This report tells what the potential is, and how to spot its likely attainment.
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It’s decision time for this rally as gold rests in the downtrend area around 1810. The 6-7 week cycle projection is xxxx (subscriber version only), but they would need to push through resistance around xxxx (subscriber version). Cycles remain at cross purposes, which is conducive to xxxxxxxxxxxxx (subscriber version) .
HUI needs to clear xxx (subscriber version) to complete an intermediate term bottom. If successful, the measuring implication would be around xxx.
Today’s screen yielded only 1 short term buy signal. Yesterday’s downtick began triggering sells with 6 of the 52 stocks in the screen flipping sell side switches. The intermediate trend structures still hold the prospect of a near term upturn. So I’ll stick with the 5 charts on the list (subscriber version), but won’t add any new ones today.
This report includes the cycle projections for short to long term time frames, and swing trade mining picks. Get ready for the big move now!
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Gold is on the cusp of signaling a possible intermediate cycle low. A daily close above the trendlines at xxxx (subscribers only) would be a good start to confirming that. Short term cycles are in up phases, with a new projection of xxxx (subscribers only). That suggests that something bigger is afoot. But a failure to clear xxxx would be a warning sign that the down phases in the 9-12 month and 13 week cycles are not yet complete.
This report includes the cycle projections for short to long term time frames, and 4 new swing trade mining picks to add to the one already on the list. Get ready for the big move now!
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It’s too soon to tell if this is repair or consolidation, but the risks are high, and the downside targets remain in place for now. We still have one mining pick in hand. It isn’t barking but isn’t rolling over. It’s the best chart of a bad class.
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The scary part of this week is the premature failure of the 13 week cycle up phase. It confirms the down phases in bigger cycles and sets up a kiss of death. This report shows how, along with price and time targets for the short, intermediate, and longer term.
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Cycle juxtaposition expresses as range or does the range cause the juxtaposition. This report gives the parameters that will signal change. Meanwhile, there’s still that one lonely mining pick.
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Lee Adler