Disqus - Latest Comments for garys

Re: Calculated Risks

Gary Savage — Thu, 17 Mar 2016 09:31:01 -0000

I'll put together a chart of the multi-year cycles and post in a bit so you can see what I'm talking about when I reference the 4 and 7 YCL in stocks.

Re: Calculated Risks

Gary Savage — Wed, 16 Mar 2016 23:00:59 -0000

Just something to consider. Smart money likes to run stops and create an undercut bottom so they can enter as low as possible. A classic example was the January bottom in miners. They do the same thing at tops. They manufacture a breakout so retail traders buy the breakout and smart money sells to them ahead of the impending intermediate correction. Gold is 15 weeks into an intermediate cycle. Be mindful of a false breakout as a possible intermediate top.

And the dollar is getting very late in its daily and possibly intermediate cycle as well.

Re: No Real Change Here

Gary Savage — Wed, 16 Mar 2016 11:51:56 -0000

I responded to your question over at the SMT blog.

Re: No Real Change Here

Gary Savage — Wed, 16 Mar 2016 11:15:17 -0000

I tend to think it's way too late in the 7 year cycle for stocks to be starting a multi-year bear market. Plus we have virtually every central bank printing trillions of currency units and negative interest rates. I doubt that is the recipe for a bear market. Over the last 16 years that has been a recipe for a bubble.

So I'm in the camp that says what we've experienced over the last year has been the deep correction that will set the stage for the next bubble. Similar to what happened in 98 in stocks, or early 2007 for oil.

And if we are about to enter a bubble phase then it has to eventually be led by biotech. That is where the innovation is, just like the personal computer and internet led the last bubble in the late nineties.

Re: No Real Change Here

Gary Savage — Wed, 16 Mar 2016 06:56:29 -0000

FWIW sentiment in IBB is down to 17% bulls. I don't think I would sell short with that kind of negativity. Might be good for a double bottom or undercut low though. Biotech is probably in a stage 4 bottoming process. And the volume in the triple leveraged fund LABU has been gigantic. Maybe even more so than NUGT back in December and January.

Re: There It Is Again

Gary Savage — Sun, 13 Mar 2016 21:09:42 -0000

FWIW I believe that if any of the major indexes break the 7 year cycle down trend line then the low is in, and a new 7 year cycle will have begun. The Russell and mid caps are closest to a break.

I really wanted to see the market test 1600 but when the last daily cycle "mysteriously" bottomed on day 16 I started to give up on that idea.

Re: Weekend Review Feb 28

Gary Savage — Mon, 29 Feb 2016 08:23:27 -0000

Something I have noticed on the COT. It usually takes at least 300,000+ contracts short (commercials) before and intermediate cycle tops. Even though gold is well above the October high the commercials still only have 283,000 contracts short.

And during bull markets is can require up to 350,000 contracts short before an intermediate cycle tops. The COT while not super bullish by any means, doesn't look exceptionally bearish yet either.

Re: Safety First

Gary Savage — Thu, 11 Feb 2016 08:30:39 -0000

I love your reports. You are much better at technical analysis than I am. That's why I'm here. :)

Re: Safety First

Gary Savage — Thu, 11 Feb 2016 07:55:06 -0000

FWIW the daily stock cycle is only on day 15. We should have 15 to 20 trading days yet before stocks print a final 7 YCL. I doubt golds intermediate cycle will top before the stock market and dollar finish the crash into the 7 YCL. The next support zone for the S&P is the 2014 YCL at 1732. That would be a spot for stocks to bounce and gold to drop into a DCL.

Re: Moving Forward On A Fed Wednesday

Gary Savage — Wed, 10 Feb 2016 08:40:18 -0000

Just something to contemplate. Perhaps gold flags for a few days to let the 10 DMA catch up to price then busts out to test the 23% Fib before moving down into a DCL. That would squeeze the early shorts expecting a top at 1200 and panic any longs who took profits and got off the train.

Just a thought, and maybe a reason not to give in to the temptation to sell short right here for a move down into a DCL if anyone was thinking about doing that.

Re: GOLD PART 2 – IN Search Of A Bottom

Gary Savage — Mon, 08 Feb 2016 09:52:51 -0000

FWIW look for the daily cycle to top on a breakout above 1191. Retail traders buy into breakouts. Smart money sells into them.

Re: GOLD PART 2 – IN Search Of A Bottom

Gary Savage — Mon, 08 Feb 2016 09:51:42 -0000

IMO the bigger the panic out of stocks will trigger more panic into gold and miners.

This is different than what happened in 2008/09.

Re: GOLD PART 2 – IN Search Of A Bottom

Gary Savage — Mon, 08 Feb 2016 08:42:25 -0000

Mark,
FWIW the dollar isn't rising as stocks fall into their 7 YCL. So the only safe haven assets to turn to are gold and bonds. I doubt this time will be similar to 2008. During that crash the safe haven was into the dollar. Not this time.

So the more panic selling in stocks should trigger panic buying in gold and bonds.

Re: Is That Toast You Have There?

Gary Savage — Thu, 04 Feb 2016 10:13:15 -0000

Time to make some real money for a change in this sector :-)

Re: Is That Toast You Have There?

Gary Savage — Thu, 04 Feb 2016 09:58:48 -0000

I agree the dollar is double topping. When the dollar dropped below the May low in August that was a warning sign that something was wrong as an ICL should not be making lower lows if the larger 3 year cycle was still advancing. That was the point were I started to entertain the idea that maybe the dollar was forming a megaphone topping pattern.

FWIW the dollar did marginally break to new highs in November. Stockcharts doesn't show it but the DXY index does.

Re: Is That Toast You Have There?

Gary Savage — Thu, 04 Feb 2016 09:17:40 -0000

FWIW, the dollar did not break the intermediate trend line in Dec. It also didn't produce at least one failed daily cycle. So I would conclude that the drop in December wasn't an ICL. The ICL is happening now with the current daily cycle.

Re: 1-29 Wkend Report: It’s Adding Up

Gary Savage — Sun, 31 Jan 2016 10:14:55 -0000

The inverse happened in stocks back in July when the Nasdaq brole out briefly to new highs.

It would be nice to finally be done with this bear market :-)

Re: 1-29 Wkend Report: It’s Adding Up

Gary Savage — Sun, 31 Jan 2016 05:09:19 -0000

Classic bear trap in miners. No guarantee, but many cyclical & secular trend changes occur like this.

Re: 1-29-2016 follow Up

Gary Savage — Fri, 29 Jan 2016 08:13:43 -0000

I'm thinking gold is just moving down into a half cycle low.

Re: They Did What?

Gary Savage — Wed, 20 Jan 2016 08:58:24 -0000

But then again the juniors are down 90% from the highs. That is in line with the most destructive bear markets in history. I think we can safely call them "cheap" at this point. But yes they can go lower still.

Re: They Did What?

Gary Savage — Wed, 20 Jan 2016 03:25:28 -0000

Of course it could just be smart monney creating a stop run in the miners so they can load up cheap before gold starts another leg higher.

Re: 1-13-2016 Observations

Gary Savage — Wed, 13 Jan 2016 09:18:45 -0000

I'm actually agreeing with you. It looks to me like gold made an ICL in Dec.and will probably hold those lows. Then once silver finds its bottom the whole sector should rally nicely.

I guess it's possible that gold could make a lower low and maybe test the $1000-1030 zone but that wouldn't be the highest odds considering it formed a right translated cycle.

I'm going to make a guess and say that big money will try to run stops in silver and miners to get everyone on the wrong side of the market and scoop up their shares cheap before the next rally starts.

Re: 1-13-2016 Observations

Gary Savage — Wed, 13 Jan 2016 08:52:33 -0000

It looks like the entire metals sector is waiting on silver to find its ICL. Currently on week 20 and oversold on the weekly charts. One more lower low like it did in the summer would confirm the 20 week count and set up a nice multi week rally once the bottom is in.

Re: Homework

Gary Savage — Sat, 26 Dec 2015 18:14:37 -0000

Notice also that the yearly cycle low in Aug. dropped below the YCL in February of last year.

A failed yearly cycle. Hmmm....

Re: Homework

Gary Savage — Sat, 26 Dec 2015 18:11:40 -0000

I like to track the NYA as there is no futures market in that index to push it around. The NYA quit going up just as soon as the dollar started to rally last year. And the NYA is much weaker than the other indexes. I tend to think the NYA is indicative of what is really going on underneath the hood of the market.

Granted I'm not brave enough to short the stock market, but I think the S&P, Dow and NDX are signalling more strength than actually exists.