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Strategies & Market Trends : Group Theories

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To: macavity who wrote (748)	10/16/2003 8:49:32 AM
From: macavity	Read Replies (1) of 1017

ST Outlook PM Complex. ST Outlook: MIXED (Bullish/Neutral) IT Outlook: MIXED (Neutral/Bullish) The ST Outlook is a bit of a pig's ear. The IT Outlook for the PM stocks has improved but there does not appear to have been much progress over the past 2 sessions. On the ST, we are not even o/bt but the indices and respective stocks are having problems rallying. There are bearish gaps in charts, best seen in $XAU. I am therefore waiting for follow-through from $HUI=200 and for $XAU to close above 93.52. The reasons for being cautious are twofold. i) $HUI, $XAU, $AU and $AG all have MONTHLY charts that have turned down - This is an LT signal but is a warning. I was surprised when this happened, but facts are facts. If it was just the Metals - $AU and $AG - I would not be worried, but the fact that the PM indices' MONTHLY charts simultaneously turned down, means that we (or I at least) need for the Sep2003 highs to be taken out for me to feel safe that this LT BULL is back on track ii) $USD appears to be bottoming vs. other currencies. I have a small position - Long USD short CHF - that I am looking to add to. I have already mentioned that LT Charts for $USD are showing $USD-positive aspects as $USD re-tests $USD=92.00. So the fact that we have weakness in MONTHLY charts, and the fact that $USD may be rising from the dead means that I want to see more follow through here, given the bullish gold and bearish $USD sentiment. Most rallies in the PM stocks have not been accompanied by volume. Two ways of playing this. Go long with a tight stop, or arrive late at the party. I will choose the second. I look at the stocks and see too many patterns like HL - rallies on declining volume. If this is really a 'third wave advance' there will be plenty of time to play it. I can picture a further drop from here. Maybe we are just pinning strikes for expiry. Who knows? -awaiting a close ($XAU) above resistance. -macavity

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