Hamilton's E-Wave Analysis

HUI or Gold Bug ETF, Jan 2010

Like the the HUI is a great index to see what might happen in the gold space. In this case, see below, it more or less confirms, or at least , supports our bearish stance. Also it provides a very good example of how patterns occur over and over albeit usually in a specific order. These are both standard wedges, they always occur at tops and are invariable retraced in their entirety. Notice also that both the RSI and the MACD both warn of imminent tops, in the former case even by almost 6 months.

Another dead give away is the double top without a clear impuls  wave leading to the second top. Chances are that the first top is the “real” one and the second simple the result of an overly exuberant retracement, which may mean that what we are looking at is an A-B-C flat in which case the HUI  might (repeat might ) trade back to the lows.