| Stock Chart Patterns of the $XAU $HUI BKX RKH |
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| Friday, February 10, 2006 |
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Evening Update
The Gold and Silver Index - Philadelphia (XAU)
The daily chart of the XAU is currently a lot more bullish than the daily chart of the HUI. The XAU is currently going through a shallow ABC correction. It is in a wave 3 of 4 correction on the daily. Should the lows from today hold around 137.00 which is a 25% retracement from the highs that would be a bullish sign because bullish markets have shallow corrections. Even if 137 is taken out and it goes to around 117 , which is the 50% retracement, the uptrend line would still be in tact and there would be no overlapping. We will have to wait and see. There are no trades recommended at this time. Nothing to go long. Sit on hands!
The Gold Bugs Index - Amex (HUI)
On the weekly chart of the HUI we currently have a breakout of a rectangle pattern/slim Jim. How you measure this type of pattern is by measuring the distance between the top and bottom trend lines. If you do this, you get price of 94.79 points which is the width of the slim Jim. If you then add 94.79 to 258.60 which is the breakout point you will then get a target price of 353.39. Well, we have hit target by a few points. We have to wait and see how this works out. The XAU paints a different picture. Higher prices would make the HUI more bullish.
The Bank Index - Philadelphia (BKX)
The daily chart currently shows a bullish falling continuation wedge. The BKX out performed the SPX this week which is pretty bullish. It has gone up the last 3 days in a row. The BKX is currently at resistance on the daily, yet the PPO and stochastics are now in a bullish divergence.
Bank Regional Holders ETF (RKH)
The S&P500 and a slew of sectors and sub-sectors are all in this neutral symmetrical triangle pattern as shown on the daily chart of the RKH. Banks are likely to front run the market and show which direction we will break out of these triangles. The RKH is trying to go bullish on all indicators and looks like we are in a running correction with a higher high yet to come. That is very good. Which ever way the BKX and RKH go the market will likely follow.
- Market manipulationLet's talk about market manipulation. Let us assume that the markets have always been under the influence of manipulation, and the only thing that has changed it that we now have the mechanisms/tools with which to discern this.
- The markets giveth and the markets taketh away Days like today can be demoralizing to traders who see profits disintegrate, stops hit and stocks under distribution. It is precisely at these times that we must "steel" ourselves, and not give up in disgust and self-loathing. Your emotions are your greatest enemy on days like today.
$XAU
$HUI
$BKX
RKH
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