4 replies to this topic

[SilentOne]

I've been looking for confirmation that a 9 year Hurst cycle low has been made. Given the new highs printed this month, and the 4.5 year cycle period from July 2005 is dragging on, chances are the 9 year low was printed in Feb 2010. The other possibility is August 2009. The point is that a 9 year Hurst cycle low has likely come and gone.

I'm using a Hurst Trading software to generate the plot below. The software is bound by nominal Hurst cycle periods (ie. 10, 20, 40 week, 18 month and 4.5 year cycle periods). I actually follow different cycle periods for gold and the HUI (starting with 15 weeks, 56 weeks or 13/14 months, 26/27 months and 4.5 years). Hurst did state that gold seemed to move with slightly different cycles to stocks etc. So while Oct. 2008 was clearly the nominal low for gold, it made a higher cycle low at the 4.5 and 9 year cycle nest of lows. I do not agree with the placement of some of the diamonds shown below (eg. 18 month low in July 2007 - ie. it should have been earlier in Oct. 2006), but I cannot dictate where the software locates the lows, I can only guide it using an expert model (which I input) as reference. I should also point out that the software has only tentatively confirmed the 9 year low by placing a red hollow diamond.

When gold and golds stocks starting to break higher in July/August last year, I knew that something was up regarding the longer term cycles. I expected everything to head into lows late 2009 based on the 13/14 and 26/27 month cycles I follow. This also meant that the nominal cycle low came very early which was quite bullish. The same occurred for the last 4.5 year low in July 2005.

So what does this say for gold? While I expect a near term peak, I don't expect gold to restest the $1000 level, and it likely will not even see its Feb. 2010 low (~1050) if the 9 year low is in. The cycles have been nothing but extremely right translated and if you look back to July 2005, as the last 4.5 year Hurst cycle low, you can see that gold will simply grind higher from here, despite the inevitable corrections.

So strategically, you'd want to buy pullbacks if you do not have your intended investment position. I did buy into the March pullback to add to holdings, and now I will look at the next opportunity. It may come after corrections from higher levels, I don't really know right now. A near term correction is due and from there gold should grind higher into an autumn peak (Oct.?).

cheers,

john

P.S. The other "tell" is my HUI Gann level of 467.

http://www.traders-t...howtopic=118905

Edited by SilentOne, 16 May 2010 - 09:57 PM.

[johngeorge]

That's truly an awesome piece of work, john. Thank you for sharing. Best to you.

[inamosa]

Thank you for sharing John. May I ask what software you're using?

[wxman]

this has been my picture of the 8 yr cycle, no low since then
http://stockcharts.com/h-sc/ui?s=$GOL...0&listNum=1

Attached Thumbnails

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[SilentOne]

hi ST,

http://www.sentientcode.com/

cheers,

john

P.S. This is the only Hurst Trading software that I am aware of that uses the principles taught in the Hurst Cycles course. Many other programs are add-ons to trading software and rely on the concepts presented in Hurst's earlier work.

Edited by SilentOne, 17 May 2010 - 07:19 AM.