Author Archives: ElliottWaveTrader

Could The Miners Have Provided The Ultimate Fake Out?

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by Avi Gilburt, ElliottWaveTrader.net

First published Sat Jan 7 for members of ElliottWaveTrader.net:  This past week saw a very nice move higher in the GDX and gold, but silver has seriously lagged, which does dampen any outright bullishness at this time.  But, let’s review where we stand overall.

Several weeks ago, as the GDX broke down below its .618 retracement, many were throwing in the bullish towel, and everyone seemed to adopt the “clear” heads and shoulders pattern presenting on the daily chart, while pointing to target levels below the January 2016 low.  But, it just seemed too obvious to me, and it seemed like the market was setting everyone up.

In November, well before we broke the .618 retracement and well before we broke the neckline of the seeming heads and shoulders pattern, I wrote the following:

In our Trading Room at Elliottwavetrader.net and in my live video sessions with our members, I have noted several times over the past weeks that the perfect bottoming set up would begin as the market recognizes a heads and shoulders pattern setting up in the GDX.  And, many this past week were pointing to this “perfect” pattern, which they view as setting us up for new lows in the complex.  In fact, it could be “too perfect” since the entire market seems to now be hyper-focused on how it is going to take us to lower lows.

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Are We Out of the Woods Yet?

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First published Sun Jan 1 for members of ElliottWaveTrader.net:  Last weekend (Christmas weekend), I noted that set ups such as we have been seeing in the GDX usually lead to strong rallies which can see a 10% move higher quite quickly.  Since then, the GDX ran 19% from its recent lows, with Thursday (Dec 29) alone seeing a 7.5% rise. Yes, these divergent set ups can provide for powerful reversal reactions.  But, it does not mean we are out of the woods just yet.

In fact, silver still is quite weak, and gold has not yet convinced me either.  Moreover, one does not have to make this very complicated at this point in time when one views the daily chart on the GDX.  As many of you, as well as the rest of the market, have been seeing the downtrend channel we have developed in the GDX, we cannot gain escape velocity until we are able to clear that 22.50 region.

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Is It Time to Give Up?

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Is It Time To Give Up? by Avi Gilburt, ElliottWaveTrader.net

First published Sat Dec 17 for members of ElliottWaveTrader.net:  When dealing with markets, one must avoid, as much as possible, emotional responses and simply focus on the facts before us.  Last weekend, I presented my “factual” analysis of the market, and explained why I have retained a larger degree bullish perspective.  I suggest you review what I wrote so you can understand how I weigh the pros and cons in the complex, and why I have come to the conclusion I maintain.  Moreover, within the analysis I have been providing for the last month, I have been suggesting that another drop will likely be seen in the GDX and silver, and this past week that has finally been seen.

With the drop this past week in silver and GDX to lower levels below the November lows, the market has just about completed the pattern I have been tracking to end this correction which began in August. As I noted during my mid-week update, the initial rally off the Jan/Dec lows took 8 months, and the correction has now taken half that time.  This is quite normal for timing on corrections, so there is nothing unusual about the timing aspect of the correction.

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Manipulators, the PPT and Peter Pan Send the Stock Market Higher

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by Avi Gilburt, ElliottWaveTrader.net

“You can fly, you can fly, you can fly” – Peter Pan

It seems that, once again, the stock market rally has taken most by surprise. Yes, the US stock market has been making new all-time highs, and everyone seems to be scratching their heads. In fact, I believe we recently even witnessed a Dow Theory confirmation of this stock market rally.

The common recent expectation was that a Trump win was going to crash the markets. In fact, when the market headed higher against a particular analysts’ expectations, he ridiculously claimed that the current equity market rally is a “manufactured rally” for the sole purpose of allowing big money to “escape the market,” only for Obama to then cause a big crash in the stock market before Trump’s inauguration in order to “hand him as big a mess as possible.” You just can’t make stuff like this up. And, amazingly, there are investors that follow this “analyst,” but clearly with a lot less money now in their pockets.

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Time For The Gold Bulls To Step Up – If There Are Any Left

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 First published Sat Nov 19 for members of ElliottWaveTrader.netTwo weeks ago, I noted that we had a completed pattern to the downside in the equity market and it was time for the equity market bulls to step up.  And, boy, did they ever. Now, it is time for the metals bulls to do the same.  But, it seems I cannot find them.

Last weekend, I noted that the bulls have gone into hiding.  This past week, they were scared even further into their shell.  Yes, bullish sentiment in the complex has dropped to almost nothing.  For those that review market sentiment readings, you will know that we have almost no bulls left in this market, or at least bulls who are willing to admit it.  That is often a strong indication that we are bottoming, and not collapsing.

I also noted in my last weekend report that, if our pattern was going to hold for potential bottoming in the complex, we would need to see a “bounce” early in the week, which would then likely lead to a lower low later in the week.  The market has followed through quite nicely with this bottoming pattern thus far.

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Where Did The Bulls Go?

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by Avi Gilburt, ElliottWaveTrader.net

I look all around me, and those that were bullish have now turned bearish, and those that were bearish are now drooling and foaming at the mouth.  What happened to all the bulls?

When everyone turns bearish, especially after an impulsive structure off the 2015 lows has completed, and starts looking to further lows in the complex, it means the time is approaching for a potential reversal.  One of our astute members said “when fear of missing out turns into fear of being in, you know you’re close to a bottom!”

I have noted several times over the past weeks that the perfect bottoming set up would begin as the market recognizes a heads and shoulders pattern setting up in the GDX.  And, many this past week were pointing to this “perfect” pattern, which they view as setting us up for new lows in the complex.  In fact, it could be “too perfect” since the entire market seems to now be hyper-focused on how it is going to take us to lower lows.

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Why Do You Allow Yourself to Be Manipulated?

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by Avi Gilburt, ElliottWaveTrader.net

After recently hitting our 5th anniversary at Elliottwavetrader.net, and now exceeding 3000 members, I have learned quite a lot about market participants.  For example, the one thing that hurts investors the most is when they lie to themselves or allow others to lie to them.

The problem is that there are so many fallacies accepted as gospel in the financial world that it causes investors to continually be looking the wrong way.  And, worse yet, “analysts” without any analytical depth (or ethics) fall back upon these fallacies, which allows them to be inappropriately propagated even further throughout the market.

When I was in 5rd grade, my teacher had a sign hanging at the front of the room which said “put brain in gear before engaging mouth.”  I would like to slightly modify this sound advice to fit our purposes in the financial markets: “put brain in gear before engaging pocketbook.”

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