Folks, I have been subtly trying to paint an optimistic face on the HUI but it just won’t let me. This last rally we had off of the 390 bottom to the 460 top was the most important rally phase, for me, in the last 6 months or so. This rally was going to tell me if we were going to put in the 2nd right shoulder to match the left side of the H&S or were we going to rally up to new highs and negate the H&S top pattern altogether. The jury is still out yet as we haven’t broken the neckline but the symmetry is building out as we now have a strong possibility that the 2nd shoulder, on the right side of the H&S, is completing. If we takeout the neckline at 390 the H&S top will be complete and a price objective down to the old low at 285 would be in order.
It pains me to have to do a post like this as I know so many are just barely hanging on. There is no need to panic at this point as you can watch the neckline at 390 for a point to lighten up or do whatever you need to do if it is broken. I personally went to 75% cash this morning in anticipation of further weakness. If we take out the 2nd right shoulder high at 460, that will be my cue to reenter the PM stocks again. Until then I will let the market do its own thing without me.
This is the 60 minute chart I posted yesterday showing where we hit the old neckline support and stated “I wanted to see us rally up off of that support with new vigor”. No vigor on the upside today.
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The daily look shows the symmetry of the 2 shoulders on each side of the head.
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And the weekly look.
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Please do your own DD as I’m just one small voice in the ocean of opinions. All the best… Rambus