CHART UPDATE
I have been looking over my charts this weekend and I think they are starting to give us some valuable information.
Silver
futures.tradingcharts.com
This chart shows the potential double top forming in silver. The chart that I used is a cash chart which shows a similar pattern. The two tops on the cash chart are around 665 the bottom of the “M” or midpoint is around 615, a difference of 50. This means that IF silver were to close below 615 decisively the moves projects to 565. This puts us near the breakout point in November at about 540 and would represent an appropriate and orderly correction consistent with an ongoing bull market. Also, it will likely occur near the 200 day moving average. If silver does not close below 615 and complete the double top it would I think be very bullish. I favor the double top scenario, but cannot rule out the more bullish scenario.
GOLD
I can’t display the chart I am using here but on Jan. 16 Gold touched an important point where the bottom of the bollinger bands and the 50 day ma converged.. It bounced very slightly and has now penetrated the 50 day ma. While I can’t yet give a target it definitely looks lower to me. Maybe 200 day ma will be tested.
HUI
The HUI has put in a double top which projects to 182
bigcharts.marketwatch.com
A few other stocks with similar formations and targets are as follows:
Head and shoulders:
GOLD STOCKS
There are a few stocks at or near their 200 day mva for example ABX, ASA, GFI, GG (slight downside penetration), GOLD (has penetrated but closed right on line),. The following stocks have decisively penetrated their 200 day mva KGC, LIHRY, MDG, RANGY, RGLD, VGZ. These penetrations are for the most part recent and portend that the down move isn’t over.
There are also several stocks which have formations which provide downside targets.
ASA has formed a head and shoulders top which projects to 40 to 38 depending on how you interpret the top..
I see the Left shoulder formed in November, top is late nov early dec. R shoulder is jan. highs breakout is around 39 to 40. I think 38 is best target because next good support is there.
bigcharts.marketwatch.com
CAMBIOR
Head and shoulders top projects to 2.02 This is a well formed top and easily identified.
bigcharts.marketwatch.com
Draw neckline from Nov. lows to Dec. lows. the top is at 3.78 neckline penetrated at 2.90. mid point of neckline is about 2.90. projects 2.02
GOLD CORP
bigcharts.marketwatch.com
Another H&S top projects to 12,
GLAMIS
bigcharts.marketwatch.com
Completed double top projects to 12.
RANDGOLD
bigcharts.marketwatch.com
This is a double top projecting to 18, but downside breakout on gap Friday, portends extreme weakness.
HARMONY
bigcharts.marketwatch.com
H&S projects to 14.5
ADDITIONAL COMMENTS
A few other stocks with similar formations and targets for which I have not provided are::
Head and shoulders:
KGC 6
Double Tops and Targets
MG135 Media General gold index currently 280 projects to 245
NEM –40
Conclusion:
It appears to me that we have more to go on the downside. I am keeping my powder dry and hoping I will recognize the turn when it comes and load up near the bottom.
Live long and prosper.
Little joe |
