Month: February 2014

XAU , Philly Goldstock index.

Hamilton

xau 20 nov 2011xau feb 19 2014

Then (Nov. 20, 2011) and now charts. There are still two possibilities. The now 3 year bear is a wave C and is still incomplete, or it is an A-B-C bear from the second top and is also incomplete. Both need at least a 4th and 5th wave. On the positive side the XAU has averaged about 120 over the past 30 odd years so these stocks are already “undervalued”- see previous blogs. Keep in mind that this index contains 13 goldstocks, not a single one of which will necessarily follow this pattern, but on average they should.

Dow Jones Ind. Ave.

Hamilton

djia feb 18 2014

Cannot resist the temptation. This is the DOW today. Sure looks like a triangle. Means a big up day to start, about 16190 at about 10 to 11 o’çlock am. Then down for the rest of the day.

The chances that the TSX will be up another day are

(1 ÷ 2)^11 =0.00048828125, that is , of course not true as it is 50-50 or 1/2, but at the beginning that is what the chance would have been.

R, Romarco update and ZJG

Hamilton

R feb 2014 lR feb 18 2014 s

See also previous blogs. From the big picture it is clear that this stock could easily go higher than the $2.80 that it reached three years and a bit (not on the lower chart) ago. There is no prospecting or any of that kind of uncertainty attached to this stock, just the permits and the improved technologies that allow more of the precious metal to be leached out of the tailings. Our best guess here is that a wave 2 (A-B-C or A-B-C X A-B-C) was completed either in July last year or more recently in Dec. of this year. What stands out is a fairly clear triangle (always a wave 4 or B). The stock should normally trade back to the highest point in the triangle ($1.40) as a minimum. The gap recently suggest a wave 3 of minor 1 is in progress. It should complete near the $1 mark, then fall back a bit and then continue up. This may even happen a little sooner as the stock is a bit overbought. The ZJG (BMO Junior golds) more or less confirms the idea of of a large A-B-C down, from $25 to $5.76, see below;

ZJG feb 2014

Ready to break out?

AEM, Agnico Eagle Mines update.

Hamilton

As with Franco Nevada, Agnico Eagle Mines also sports a pretty good looking B-wave, however, it did so a few years ago so it might just tell us what could be in store for FNV;

AEM feb 15 2014AEM feb 15 2014 b

The count over all these years is by no means perfectly clear but the B-wave is. Also it is very clear that the C following the B can be extremely devastating. From roughly $90 to $25 is no fun if you happen to own it, particularly not if you own it as a hedge against inflation and/or a financial disaster. If the C wave is indeed a diagonal than it may not be over yet (see also previous blogs). By the way, you can click on this chart and move it side by side with FNV just to get a better feel for what might happen. I have no idea why these two stocks would be so out of phase with each other; AEM is more or less in tune with the rest of the gold stocks and FNV simple is not.