September 12, 2013

We ended the 3rd step of the current rally yesterday and 4th step  will be

 starting today. It will be a moderate decline followed by a 5th step up to a new high in the current rally. Most stocks will not go above the previous highs but some will exceed the previous highs. Those who sold TNA yesterday sold near the highs yesterday.

Here are some charts to look at
DJI

SPY

IWM (ETF for Russell 2000)

TNA

GOLD
Gold had a big decline today and all gold related stocks are down sharply.
This does not  mean that  you should sell your positions today.
We can start looking at GDX  ( ETF for Gold mining stocks)

We can look at the Fibonacci analysis of the previous decline we had from July 23 to till Aug 6 . The decline was a hefty 78% of the rally. All of that decline was retraced within 4 days.
The decline this time on GDX from the high this time is also shown below and will probably be 78 %

See below Fibonacci chart for GDX for the current rally. It is almost there.

Because NUGT is leveraged, it will have a little more decline than 78% from the peak.

Also let us look at NUGT chart for the last 10 days. The 5th leg down is being completed today.  So we  may have a rally starting tomorrow.
See below.:

So we were early in buying NUGT yesterday.

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Sept 11 Wednesday

We do not have any SELL signal yet in the current rally in stocks, which we predicted in our  post of
Thursday Sept. 2.  This kind of rally is usually in five steps. One up, two down, three up , 4th down and finally 5th up.
We cannot be sure whether the 3rd step got completed yesterday or not but we have had 7 trading days of the rally so far. There may be one or two more days left in the third step. Remember the 3rd step itself has   5 portions. At any rate, since we have a nice  profit in TNA, we should lock our profits now. After the 3rd step has been completed,  we will have a modest decline and you can get back into TNA again. Please do not buy TZA yet as we do not have a sell signal yet on IWM ( ETF for Russell 2000).

The rest of the market has been behaving as predicted. And mind you it has nothing to do with Syria as most of the media lets you believe.

SPY

IWM

 TNA

GOLD

We gave a SELL signal on Gold   in our posting of Aug. 29.  It has been going down in 5 steps and the five steps were completed after the speech by Obama  last night ($1357).  During trading hours in New York, the low was $1359.To see this let us look at the  Gold ETF      GLD.

 GDX (Gold Miners ETF)  Notice the heavy buying in the last  two hours  yesterday in this ETF at the lowest   prices of the day. May be insiders are buying?

NUGT  (3 X leveraged ETF)

How can we tell that the top was on 8/27? Let us look at the chart from Aug 8, 2013. Remember NUGT is based on a commodity. Commodities go up & down in days not weeks or months like  common stocks on the stock markets. So let us look at NUGT in its 3rd leg rally from Aug 7, 2013


NUGT from Aug 7 to present. Notice that you could have sold on Aug 16  at the end of step (iii)or waited till the morning of Aug 27 when  it made a new high of about 105. at the end of step (v) Insiders sold near the top and bought DUST instead.
Leg 4 lasted 10 days.  Now you know when to sell . You need to buy NUGT today if you did not buy yesterday. All this has nothing to do with media and news. They do not have a clue!! They will  give some story to fit what the market is doing.

Mind you Gold mining stocks have nothing to do with what rest of the stocks are doing.

DUST

Notice while NUGT was going down, DUST was going up in five steps in the 4th leg. You would  have bought DUST (  3X Bearish ETF for Gold Miners) at $20 on Aug 27 and sold yesterday for $32

for a cool profit of 60% in 10 days without taking risk of those hedge funds who buy & sell commodities.
Don't feel bad. We will soon get an opportunity to BUY DUST when NUGT makes a new high n Leg 5 and DUST will make a new low in its 5th leg down.

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Sept 10  Tuesday 6:14 AM PT

The rally that started around Aug 29, is continuing as predicted. We are in the 3rd step up in this rally .
it will be followed by a moderate decline in step 4 followed by another new high in step 5.
If you are 3X leveraged long , take profits today. Leveraged stocks move up and down larger than an ordinary un- leveraged position and profits should be locked. Take profits in TNA. Here are some charts.

Gold and Silver  are moving sharply down today. The decline in last 5 trading sessions has been so sharp that we can expect a rally.

DJI

 GDX

 GLD Gold ETF

IWM Russell 2000 ETF

 NUGT  ( Gold Miners ETF)

 SPY

Here is a link to a video where the commentator thinks that if Gold holds above $1350, it can go up to
$1500
http://www.kitco.com/news/video/show/Chart-This/420/2013-09-09/Chart-This-Fibonacci-the-Real-Star-in-Gold-Forecasting

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Sept 9, 2013 6:35 AM PT

As we had mentioned in Friday's blog posting the rally will continue with more intensity. On Friday from a low of -144, it closed at a small decline. Same thing happened with SPY & IWM, TNA & NUGT
 Let us look at some of the charts :

DJI

SPY

IWM

TNA

You can see how the rally developed in TNA in the last 5 days. Note the heavy buying near the decline on Friday Sept 6, 2013

Silver ETF SLV is giving a BUY signal today.

Triple X Silver  ETF is also giving a BUY signal today

Gold miners ETF   GDX is getting ready to give a BUY signal

3X leveraged Gold miners index is also getting ready to give a BUY signal soon

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Friday  Sept. 6, 2013 5:45 AM PT

As we had told you  on September 2 , the stock market will start going up. After slight consolidation yesterday and today, the market  may  start accelerating up today. Gold and Silver completed their 5  minor steps down of the 4th leg down. It is ready to start 5th leg up making either new highs or matching the  previous highs.
Let us look at yesterday's charts

DJI
It crossed the 15 Day moving Average yesterday

SPY
Croosed the 15 day moving average and ready to cross the 50 day moving average

 IWM
Crossed the 15 day moving average and  crossed  the 50 day moving average  also.

TNA ( 3X Russell 2000 ETF BULL) Already crossed 15 day moving average. Ready to cross 50 day moving average.

GDX ( Gold Miners ETF) It completed 5 steps of 4th leg down yesterday.
Will start 5th leg up today.

NUGT ( 3X Gold Miners  ETF)

BONDS
10 year  Treasury  notes had the highest interest rate equal to 2.9% yesterday which is highest in 2 years.
Interest rates may have peaked for the short term and will start declining in 5 steps now.


It is very useful to look at 6 month charts of 2 0 year plus bonds ETF TLT. It has lost 20% in the last 4 months. Wait for the rally . Then you should sell all your long term bonds. We have had the biggest bubble in the the bond market  for the last 10 years. Now we will be bursting this bubble.

What could you have done ? Sell the bond when you get the SELL signal and buy 3X Bearish Bond ETF called TTT. See the chart below. You would have made more than  50% .

PIMCO is manager of 2 Trillion dollars worth of bonds. Let us see how their $ 252 Billion dollar fund ETF  called BOND behaved in last 6 months

It has lost 8% in the last 4 months. After rally in bonds is over, the bonds will make new lows.

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US stocks, Gold & Silver are heading back to Previous highs established on Aug 2, 2013. We cannot say the same about rest of the  stock markets in Asia and Europe. We wrote about this on our post of Sept. 2, 2013

Let us look at some charts
DJI

SPY

IWM  ( ETF corresponding to RUSSELL 2000)

GOLD

SILVER

GDX ( Gold Miners ETF)

NUGT ( 3X Leveraged ETF)

USLV  ( Silver  3X  ETF)

TNA  (3X Leveraged  Russell 2000)

GOLD TECHNICALS  Courtesy of Kitco.com

Silver Futures

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