15 replies to this topic

[SilentOne]

I will now rely on my Hurst cycle analysis and the next clear buy signal to go long, whenever it comes. The six indicator buy/sell (aka denmo six) on the daily chart went on a sell late last month and has not swung to a buy yet.

I count weeks and months to what should be a nest of lows for the 15 week cycle and the 13/14 month cycle (as shown on this chart). As you can see in the chart below, there appears to be a very distinct 13/14 month cycle, a 4.5 year cycle, and possibly a 4.5 year mid-cycle. From the last eight 13/14 month samples as shown, the average is 13.4 months. Only one came in early at 12 months and one late at 15, with the rest giving a cycle period of 13 or 14 months. It looks very reliable to me. We are currently in the 11th month from the last low (June 2006). So we are early in this 13/14 month cycle for a low.

The 4.5 year mid-cycle also seems to show up quite regularly in HUI/XAU charts. The last three examples are 26, 27 and 28. We are currently 24 months into this cycle and a bottom right now would be early.

We also had only three nominal 15 week cycles since the last 13/14 month cycle low. From my studies, there should be 4 (ie. 4 x 15 weeks ~ 60 weeks). Thus we are in the last 15 week cycle and looking for its low in this regard as well.

We do not have much room for downside to stay bullish IMO. Any breach of last week's lows (HUI 333 or XAU 135) means the 15 week cycle that bottomed recently has already topped, and we head down into its low. The HUI LT trendline (log scale) rests below in the 325-330 level. We have tested it already twice since May '06. Will it hold? I'm not betting on it yet.



Finally, if these 13/14 month cycles can be relied upon, then you want to avoid the final correction that sees their lows. They are always quite pronounced and usually involve extended "C" wave declines. That may not be for weeks yet if it were to occur in this situation, but the risk is there. However, we have entered the window for a hard and fast decline to start anytime.

I have played this sector long enough to respect the risk involved. Especially when I am playing with a large % of our liquid assets.

I don't have a crystal ball. Just trading/investing what I see.

cheers,

john

Edited by SilentOne, 09 May 2007 - 05:45 AM.

[swanstkdh]

OK buddy where do I send the 199 dollares. I respect your work. It is awesome. I am all cash now as well because the metals market is ruthless when it comes to corrections, etc. Have done well so far and no feeling about where we go next. Just this blank, dark fascade so I am out. Just nothing. So I have to be out. Charts are not speaking to me, intuition. Nothing. I am female so I rely on these tools as well as technicals.

[prman]

Not a female, but otherwise I share all of swan's opinions and attributes. Your work knocks me out. You're beginning to talk like airedale, which is good. Your forecast jibes with other stuff, which is also good. I'm going to study Hurst and may occasionally seek your counsel. How long has it taken you to reach this level of proficiency with Hurst's methodology?

[dharma]

thanks john, i too appreciate your work. do inversions ever occur? if one looks at the corrections since the may 06 highs, each has covered fewer points, seems we are wound for a spring! dharma

[SilentOne]

prman,

How long has it taken you to reach this level of proficiency with Hurst's methodology?

I've taken my time learning the material. In hindsight I should have applied myself more as I have still not completed the entire course. But a couple of good weeks at it and you will understand the main principles to get you on your way. And BTW, keep reading airedale's posts.

dharma,

do inversions ever occur?

I've often heard talk of inversions. Basically people see a potential turn date (eg. Bradley) and if it doesn't produce a turn the way they expect, then it is referred to as an "inversion" for a lack of a better term.

Hursts teachings of the market cycle principles do not allow for "inversions". Near as I can tell anyhow.

cheers,

john

[Mike]

John, terrific chart, much appreciated. Here's a log chart showing the lower trendline, as you mentioned.

http://stockcharts.com/c-sc/sc?s=$HUI&p=M&st=2000-10-01&i=p35630820135&a=53880966&r=119.png

[Kimston]

Hi John,
Nice chart. What software are you using?

Your analysis generally dovetails with my work on the CRB (which is pointing down hard) and the dollar (which "should" have a sizable run-up over the next few months). In the cash gold, my cycle and pattern analysis indicates most of the price destruction may occur by the end of May, where I have a confluence of cycles pointing to a turn (presumably a low). I also have timing for turn around July 19, + or - a few days, but I'm thinking it may be more of a retest or marginal new lows after bounce in June.

I haven't studied Hurst. Read a lot of books over the years on cycle analysis and market timing, with the best being Geometry Of The Markets, by Bryce Gilmore. In my analysis I find that turning points can often be pin-pointed with a vibration in time, but sometimes things invert. For example, the following long term dollar chart I posted over the weekend has a 170 wk linear vibration that mostly picked lows; however, it marked a top in 1991 and failed in 1994.




The daily chart I also posted has 170 day vibration running through it, which helped me pin-point the low as the 170 wk cycle was bottoming.



I'm still looking for a good sentiment service on the gold market if anyone has any recommendations.

Keep up the good work.

Kimston

prman,

How long has it taken you to reach this level of proficiency with Hurst's methodology?

I've taken my time learning the material. In hindsight I should have applied myself more as I have still not completed the entire course. But a couple of good weeks at it and you will understand the main principles to get you on your way. And BTW, keep reading airedale's posts.

dharma,

do inversions ever occur?

I've often heard talk of inversions. Basically people see a potential turn date (eg. Bradley) and if it doesn't produce a turn the way they expect, then it is referred to as an "inversion" for a lack of a better term.

Hursts teachings of the market cycle principles do not allow for "inversions". Near as I can tell anyhow.

cheers,

john

[SilentOne]

Hi Kimston,

Nice chart. What software are you using?

I'm not. I simply use online charting resources like bigcharts. Tedious but it works for me.

As for a gold sentiment service, the only one I have looked in recent years is the HGNSI. As you say it is not always timely.

You might consider the %BPI (percent bullish indicator) as shown here or calculate that yourself on the XAU for example.

The current level is not bullish per say, and one can easily see where this might have to fall to to get a bullish reading. This obliged on the June '06 and Otc. '06 lows.

%BPI for Gold Stocks

cheers,

john

Edited by SilentOne, 10 May 2007 - 10:23 AM.

[SilentOne]

Yesterday's action confirmed the market risk in the PM sector. There is now virtually no room for downside before much lower price targets are activated.



Once the 15 week FLD (shown above) is broken to the downside, the 30 and 60 week FLDs will be quickly broken as well. The 30 and 60 wk FLDs currently lie at approximately HUI 317 and will be rising quickly from this week onward. If these FLDs are broken say next week in this price range (~320 - 325), this will activate a downside HUI target of 270 - 280.

If I look at a 39 day cycle, which is close to Hursts' 40 day nominal cycle (and approximately the half-cycle of the 15 week I am following), the 39 day FLD was broken late April and projects a target of HUI 310. If we do reach this target in the near term, then the 15, 30, and 60 week FLDs will be broken and open the HUI 270 - 280 target.

The 15, 30, and 60 week FLD positions are conveniently located just below the HUI LT uptrendline. Once this trendline is broken, the decline will be quick, breaking the FLDs and the lower target is activated.

cheers,

john

Edited by SilentOne, 11 May 2007 - 05:26 AM.

[swanstkdh]

Yesterday's action confirmed the market risk in the PM sector. There is now virtually no room for downside before much lower price targets are activated.



Once the 15 week FLD (shown above) is broken to the downside, the 30 and 60 week FLDs will be quickly broken as well. The 30 and 60 wk FLDs currently lie at approximately HUI 317 and will be rising quickly from this week onward. If these FLDs are broken say next week in this price range (~320 - 325), this will activate a downside HUI target of 270 - 280.

If I look at a 39 day cycle, which is close to Hursts' 40 day nominal cycle (and approximately the half-cycle of the 15 week I am following), the 39 day FLD was broken late April and projects a target of HUI 310. If we do reach this target in the near term, then the 15, 30, and 60 week FLDs will be broken and open the HUI 270 - 280 target.

The 15, 30, and 60 week FLD positions are conveniently located just below the HUI LT uptrendline. Once this trendline is broken, the decline will be quick, breaking the FLDs and the lower target is activated.

cheers,

john

this is a brutal decline. any thoughts about the death run ski is into. This must be it. thanks for your work and I am very careful about staying out for now.