Gold Bugs Index

Poring over the weekly chart during yesterday's impromptu session, we found evidence for optimism about the health of HUI's long-term bull trend. For some very specific details about this, I would recommend viewing the last ten or so minutes of the recording posted below, Bullish Look at HUI Gold Bugs Index.  The recording has been posted so that it is accessible not only to subscribers but also to those who follow commentary here casually. Besides the material concerning the HUI, the recording contains real-time analysis of the E-Mini S&P, Comex Gold and Apple (which, by the way, looks like it will continue to rampage for a long time to come). Click here to find out how you can become a 'Pivoteer'.

With a decisive push past the Hidden Pivot midpoint of the pattern shown, the Gold Bugs Index appears to be easily on its way to the 548.18 target of the pattern shown. The extended move has doubtless enticed too many bulls to yield good camouflage, but traders should note nonetheless that because the spike has yet to exceed the 532.87 'external' peak from January 12, there exists the possibility of a B-C pullback on a lesser chart that would set-up a usable point 'X' entry.  This advantage will be there only if the coordinates develop quickly, so be prepared to act. ______ UPDATE: (January 29): Bulls easily achieved the target -- and now surpassed it with a so-far high at 551.36.  The move has healthy implications, since it exceeded mid-December's  549.79 peak, creating a new and bullish impulse leg on the hourly chart in the process. A legitimate B-C pullback has yet to occur, but it would need to be at least 0.618 of the k-A segment shown to recharge HUI for another leg up.

Don't shoot me -- I'm only the messenger -- but the breach yesterday of an important midpoint support at 538.29 will have bearish implications in the weeks ahead. For if the 461.97 'D' target associated with that support were to be reached it would imply that the Gold Bugs Index is about to fall by 15%. If this worst-case scenario is not about to materialize, we should see evidence in the form of upthrusts that create a bullish impulse leg on charts of at least 15-minute degree. For that to occur today, a print at  567.75 would be needed.

From a Hidden Pivot perspective, yesterday's thrust in this vehicle was more impressive than the one considered in today's Silver Wheaton tout. Specifically, the Gold Bugs Index has already cleared an 'internal' peak -- one of two that must be exceeded to create a robustly bullish impulse leg on the hourly chart. (The second lies at 568.69. See inset.) It's a fly-or-die situation, since a failure to hurdle these peaks straightaway would leave HUI in technical Purgatory.

Downside to at least 479.62 appears likely, although any further slippage would augur 470.18.  These Hidden Pivot supports are, respectively, the 'p' midpoint of the large pattern shown, and the 'D' target of the smaller one, and they are probably the best that bulls can hope for over the near term.

Bulls will face a key test at 549.59, the midpoint resistance of the pattern shown, and if they can get past it, closing above the pivot for two consecutive days, its 'D' sibling at 580.04 will be well in play. In the meantime, we should use the lower number as a minimum upside objective for the near term.

A so-far picture-perfect pattern points lower -- to the 455.80 Hidden Pivot target of the pattern shown, at least. Odds of this vehicle averting a full correction to the target are slim, since the downtrend gapped through the 512.34 midpoint support on its first encounter with it.  HUI's fate could be annulled by a strongly impulsive upthrust -- i.e., one that surpasses a 551.78 'external' peak -- but before that occurs, it would likely be telegraphed by bullish price action -- which is to say, bullish impulsiveness -- centered on 512.34.

The selloff begun a week ago is closing on an important midpoint support at 512.14 that closely coincides with an important structural support at 512.25 recorded on August 5. A bounce from the range seems very likely, given its doubly supportive price points, but we'll need to scrutinize each phase of it on the lesser charts to accurately assess its strength.

It would take a print down at 476.39 to break the spirit, if not necessarily the spine, of the long-term bull market. The significance of this number is shown in the chart, but you should keep in mind that the move would have to occur without leaving any discernible, uptrending b-c corrections of daily-chart degree.