How many times have we heard that the precious metals stocks are so oversold and cheap that they can’t go any lower and have to rally. They just can’t go any lower because the low in 2008 was the absolute low that will never be hit again as it was just an extraordinary event. A precious metal stock crash that was a once in a lifetime thing. So based on that low many PM investors bought their precious metals stocks thinking they were buying on the cheap. I’m wondering if they still think the precious metals stocks were a good buy at that 2008 crash low in the ratio charts?

Lets look at the Gold to the XAU ratio line chart that shows the high in 2008 that was supposed to be the new benchmark for the pm stocks being oversold. As you can see on this weekly chart that the 2008 all time high for this ratio was not the concrete ceiling that everyone thought it would be. Its been making new all time highs on almost a daily basis that doesn’t show any signs of topping at the moment.

Below is a very long term monthly chart for the gold to XAU ratio. As you can see this ratio chart behaved very well trading between the blue and red horizontal trendlines for many years. The crash in 2008 for the ratio started a course of events that have significantly changed the landscape. The blue horizontal trendline was always a good place to buy precious metals stocks for years as it shows they became very oversold when the ratio got up to 5.10 or so. When the ratio got down to the 3.70 area, red trendline that was a good place to sell and take profits. When they say, this time is different, usually that means nothing has really changed except the perception of a change. In this case something really did change and its not just a perception of a change. The 2008 crash actually did change things. All the old highs at the blue horizontal trendline have now been acting as support once it was broken to the upside. Maybe the fundamentalist can figure out what has changed for the precious metals stocks compared to gold. We will know in time but for right now this ratio chart is telling to be wary of the precious metals stocks.

This next ratio chart compares DUST to the HUI. A rising price shows DUST outperforming the HUI and a declining price shows the HUI outperforming DUST. Which investment would you rather have been in since last October? The chart below needs no annotations.

Lets compare the CDNX to gold to see if the juniors have fared any better than the large cap PM stocks. You can see the crash that occurred at the high in 2008 had a fairly decent recovery off the bottom but the CDNX fell way short of making it all the way back to the previous top. It instead built the blue bearish rising wedge that has taken the price action below the impregnable 2008 low.  As you can see this ratio has gone nowhere for almost a year now trading below the 2008 low which had been holding resistance.

I think this next ratio chart is very telling and is strongly suggesting that the bull market that gold has enjoyed vs the SPX is over for now. You can see the very nice inverse H&S base that launched the bull market for gold against the SPX. That was a reversal pattern. Now note the unbalanced double top that has broken down. The double top is a reversal pattern that is reversing the 13 years bull market for gold to the SPX. These charts talking are talking to us if we care to hear what they are saying.

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Those having already signed up will continue until 10th day

Thank you all who participated and followed Rambus for the 10 day period

and thank you to those who enrolled for Full Time Chartology Classes

and Especially Thank you to those longer term Subscribers for all your support and

kind words

Enjoy

Fully

The Elephant in the room that nobody see’s. The monthly charts shows the price actions closing for the month of February below the neckline.

It is until it isn’t.

More at www.rambus1.com

Hello : My Name is Fullgoldcrown and I am a Goldoholic .

This is a Recap of Rambus Charts (with his commentary) showing what he is Seeing in the PM Stocks . (FEB 23 2013)

Since Rambus was the First to see this Huge Head and Shoulders Pattern developing in The PM
Miners Indices , there have been a plethora of naysayers , lead by other PM Market Technical Analysts.
The main theme of this negative reaction to this Huge Head and Shoulders Pattern is that
It is Too Big to be considered a valid pattern ….ie TOO BIG TO FAIL !

This is just one of many examples :

from an Recent Article by XXXXXX (CMT)

“Simply put, empirical results show that a H&S formation spanning a multi-year period most likely is NOT a H&S formation at all. The reasoning is also quite simple as a typical topping process or distribution does not normally take such a long time to take shape. In order words, it does not make much sense for strong hands to use several years to sell into strength in anticipation of a major reversal!”
……………………………………
Now to the Rambus Charts and Commentary :

First The Chart of the Whole PM Bull Market to date that has everybody up in Arms (Monthly HUI)
……………………….
Chart #1
What Do YOU See ? February 15 2013

“Beauty is In the Eye of the Beholder” ..English Proverb

Tonight I want to show you a long term monthly chart for the HUI. It seems there is alot of disbelief that if a H&S pattern is too big that it some how makes it invalid or not to be trusted. I’m curious how that rumor ever got started? Nothing could be further from the truth IMHO.

Below is a monthly chart of the HUI that shows a massive 6 year inverse, complex H&S base, that launched the bull market for the precious metals stocks back in 2001. There is a certain beauty that 6 year H&S base has that most wouldn’t recognize. If you look on each side of the Head you will see two chart patterns, one large blue formation and one small red formation. They are positioned just the opposite on each side of the head. This doesn’t change the time component as the left and right shoulders measures out very close to each other. At the very top of the chart you can see what that big 6 year H&S based measured to. As you can see it measured up to 690 which was just a tad higher than the actual all time high.

The Chartology of the entire chart is one of beauty and symmetry which some will see and others won’t. They say beauty is in the eye of the beholder. What do you see?

………………………………………..

Next is a New Years Eve Rambus Special which showed the 11 Point Diamond Reversal Pattern which presently forms the Monster Head of the Pattern…This Chart was produced Dec 30 2012

Chart #2: Diamond in the Rough

……………………………………….

Fast Forward to Today (February 22 2013)

Lets look at one more example that you won’t find anywhere else except here at Rambus Chartology. You can see two reversal patterns, the 11 point Diamond that is actually the head portion of the much bigger H&S top that few believe is for real. The other pattern is the massive H&S top. Its good that few believe this pattern is authentic because everyone can’t exit at the same time. The lower it goes the more people will begin to understand what is actually happening but it will be too late to take action and they will most likely ride the whole thing down or sell into any counter trend rally that will occur thus putting a ceiling above the price action. I hope these examples help you understand what I mean when I talk about odd and even numbered chart patterns.

Chart 3: Nervous Breakdown !

………………………………………

Now just in case you are tempted to dismiss or SHOOT the Messanger here is a a compilation of some calls that should Prove his credentials. Its called “What If” and its Rambus Incredible Call for a HUI crash in 2008 well before the fact !

EDITOR’S NOTE: WHEN DONE READING THIS LINK REMEMBER TO CLICK THE BACK BUTTON TO GET BACK AND READ THE REST OF THIS POST

http://rambus1.com/?p=1829

………………………………….

And here is a chart from May 3 2012 (9 months ago) ..that was predictive of the plunge to the eventual neckline
of this HUGE Head and Shoulders Pattern

Chart 4 Look Out Below

………………………………….

This bottom of course was followed by a Wonderful Bullish run from August to September 2012 to form the right shoulder top at 530
Rambus Subscribers were all in NUGT from early August until this run ran out of steam

………………………….

OK

Its Friday Nite February 22 2013 . The week that just passed was Devestating for gold bulls and featured what seems to be a capitulatory crash in all things PM . Searching the Web for some Hope , This Gold Permabull has found it . Amongst the wreckage of dreams and portfolios, bullish bottom callers abound. The following well seasoned and respected analysts again join in a chorus called
“THE BOTTOM is In”

Just Initials …to protect the guilty 🙂

1 A H : Gold Capitulation
2 Dave N : Mandatory rebound to at least Gold 1610 Imminent
3 T D S: We’re Headed Dramatically Higher; To Levels Few Can Even Consider
4 Jeb H : Keep Your Head When Investing In Precious Metals
5 B M : Capitulation
6 M H : Gold Bear Trap Is Sprung
7 Gold and Silver Worlds :Gold & Silver Prices Drop Into Severely Oversold Area
8 CEO Technician :Huge Buying Opportunity Setting Up in Gold
9 (Deleted) : Time to Buy Precious Metals Now
10 W Y : Carving a Reversed Head and Shoulders Instead
11 J N :A Golden Opportunity With Miners
12 Ch V : Gold & Silver Nearing MAJOR Long-Term Support
13 T C : Major Top In Stocks & Major Bottom In Gold
14 D L :The Current Currency Crisis will Ultimately
Lead to Higher Gold Prices
15 P R :”Summing up, support lines are in play for two out of three of this article’s gold charts and it’s likely that a local bottom has indeed formed. Additionally, RSI levels indicate an oversold situation. The outlook for gold from here is bullish”

As a Staunch Permagoldbug of some 20 years…I have seen the lean times (pre 2001) (2008) and the Fast Times (Gold 1900)…and I really really hope and pray these esteemed Gold Analysts are right !
Many of them however have been calling for a Bottom for quite some time
They cite : Extremes in Bearish Sentiment , Extremes in Commitment of Traders , Extremes in Momentum Indicators , Extremes in Fundamentals , Fractals , Cycles , Elliot Waves and a host of other reasons that I desperately want to believe !
However there is that one lonely nagging voice in the wilderness calling…”Its all in the Chartology”

And this time I am not going to shoot that messanger as I did in 2008 !

Rambus always tells his subscribers :
The only Rule in the PM Markets is “There are No Rules”
So anything is possible
Perhaps this will turn out to be a Bear Trap
If So , I know that Rambus (Dave from the Ozark Mountains in Arkansas)
will be able to spot it in the Charts and turn on a dime and go long
But For Now…The Charts are Shouting “Breakdown in the Precious Metals Stocks !”
And We Better believe what we see !

HERE IS HOW THE HUI WENT AFTER THAT TOO BIG TO FAIL POST WAS MADE…

………………………….

Now The Last Word from tour Self Taught Chartology Professor :

Before we move on to the subscribers questions at the forum lets take a moment and talk about a game plan going forward. Right now we find ourselves in a very unique situation in regards to the precious metals complex. There are a few times in an investor’s life where the big picture shows itself so clearly. My experience has taught me that when I see such a setup, that is this rare, the best course of action is to sit tight and don’t attempt to trade the small swings. As some of you are finding out, that have sold their 3 X etf’s, thinking gold or the precious metals stocks can’t go any lower and are ready for a bounce, may find it hard to get back in. Yes you took a nice little profit but you lost sight of the big picture. The big picture is where the big money is going to be made. Chances are if you want to get back in you will be finding yourself chasing the price action hoping and waiting for a counter trend rally that may or may not happen. Positioning is everything in the markets.

We are lucky to be in the position we find ourselves in right now. We have alot of wiggle room if there is a short covering rally that will knock your socks off. Everyone who has been calling a bottom over the last year or so will be telling you the bottoms in and the bull market is taking off again. My view is that when we do finally get a short covering rally, that will look like the bull market is stating anew, that would be the time to sell any reaming precious metals stocks you own and to use any strength to add to your Kamikaze trades or short positions.

I’m still amazed how many investors can ride a losing position down day after day but when they have a winning position they will sell out at the drop of a hat. The old wall street adage: Cut our looses and let you profits ride, easier said than done but very important concept to grasp.

I have shown you countless H&S top patterns that are just beginning to breakdown especially in the big cap sector. I’m showing you these big multi year H&S patterns to give you an idea that this decline isn’t going to be a one day wonder. Its going to take many months or longer for these big tops to play out. I can guarantee you that the volatility is going to be insane at times and your emotions will get the better of you. I have said this before, this will be the easiest and the hardest time you will have holding on to your short positions. The easiest because you don’t have to do anything except sell when we approach the bottom. The hardest because your emotions will get in the way when you read something someone wrote that say the PM stocks can’t go any lower because of this indicator or that the PM stocks haven’t been this oversold in history or what ever the reason is and you will bail to relieve the pressure.

Please keep in mind this isn’t a child’s game we are playing. When you put your hard earned money into the markets you are going up against the brightest minds and best trading systems in the world. They want your money and they could care less what excuse you give when you hand over your hard earned capital to them. You can use the excuse the markets are manipulated is why you lost or countless other excuse for not succeeding. They don’t care, they just want your money. Period!!!!!! One has to take responsibility for their success and failures and not do the blame game as that is counter productive. With that said lets move on to some subscriber questions.

All the Best
Rambus

EDITOR’S NOTE : CLICK THE BACK BUTTON TO GO BACK TO GOLDTENT AND FINISH READING THIS POST

We haven’t looked at the US Dollar in awhile so lets see what it’s been up to in the last month or so. The first chart I would like to show you is a weekly bar chart of the H&S top pattern that everybody is focused in on at the moment. It does have nice symmetry to it and looks like the real deal. Please note the blue 5 point triangle on the right side of the chart where the current price action is strongly testing the top blue rail.  As I have shown you many times an odd number of reversal points in a chart pattern equals a reversal pattern. As this triangle is forming below the H&S top we need to see a pattern that has at least 5 reversal points to reverse the downtrend to up. A breakout above the top blue rail will give us our first big clue that the potential H&S top will fail. As you can see the blue triangle on the left side of the head has 6 reversal point making it a consolidation pattern.

In order to launch a decent bull move a stock has to have a base that gives the stock the energy it needs to make a sustained move. This next 5 year daily chart shows the US Dollar does have a nice big base in which to launch a decent upward move.  Some of our earlier subscribers may remember this inverse H&S bottom that we watched develop for sometime last year. As you can see the breakout from the H&S bottom was anything but a rocket launch as the price action has been moving sideways to slightly down. Another simple clue that a bottom could be in is that the dollar has not made a lower low since the backtest to the neckline. A simple clue but an important clue up to this point. Again you can see the price action is strongly testing the top rail of the red triangle.

Below is another way we can look at the price action from the Dollar high made back in July of last year. Some of you may recall the blue morphing triangle on the left side of the chart that broke out to the upside after a false breakout to the downside at point #6. We have a similar morphing triangle on the right side of the chart. If we start the triangle from the July top then it only needs to have an even number of reversal point to make it a consolidation pattern. I have to admit its not the prettiest triangle I’ve ever seen but the way the breakout and backtest is progressing it could very well be completing the breakout phase. We will know very soon if this is the case as the top blue rail will have to reverse it’s role and act as support on any pull back. Note the gold chart at the bottom. If the dollar does in fact breaks out of the 6 point triangle to the upside that will put alot of pressure on gold.

Below is another combo chart that shows the smaller red 5 point triangle reversal pattern on the dollar and the big H&S top pattern on gold on the lower chart. What I find interesting is the last bar on the chart for both the dollar and gold. As you can see the dollar is attempting to breakout from the red triangle and gold broke below it’s big neckline last week. Coincidence?

Lets look at another combo chart for the dollar and gold that goes all the way back to 2003. The US Dollar chart on the bottom is giving a buy signal based on the 20 and 50 week ema’s. As you can see in the red circle, the faster 20 week ema has just crossed over the slower 50 week ema and the price of the US Dollar is above both moving averages at 80.58. You can also see the big long black dashed support and resistance rail that goes all the way back to 2004. That is critical resistance right now but if the dollar ever trades above that S&R rail that will be a very big deal IMHO. As you can see on the top chart gold is in a confirmed rectangle and if the dollar breaks higher that would put serious pressure on gold. Right now it looks like 86 for the dollar is resistance and 1530 is support for gold.

Lets look at one more combo chart for the US dollar and gold. On the chart below I’ve add a brown shaded area and a blue shaded area based on the two red triangles on the dollar chart on top. What this chart shows is the inverse move that the dollar.and gold tend to make. You can see that when the red triangle on the left side was building out gold moved up to point #4 on it’s rectangle and when the dollar finally broke out to the upside gold corrected down to point #5 at the bottom of the rectangle. This is where it gets interesting. Note the red triangle on the right side of the dollar chart that is getting real close to breaking the top rail. If the US dollar breaks out above the red rail that will put serious pressure on gold that will break the bottom red rail of it’s small downtrend channel. And if the dollar has a strong move up the blue bottom rail of gold’s big rectangle will be in jeopardy which would be a serious blow to gold if the bottom blue rail ever gives way. A break of gold’s bottom blue rail of it’s rectangle would then turn from support to resistance on any backtest. So we have plenty to watch over the next week or so. Stay tuned…All the best…Rambus

More (Including Free Trial) at www.rambus1.com

“Beauty is In the Eye of the Beholder” ..English Proverb

Tonight I want to show you a long term monthly chart for the HUI. It seems there is alot of disbelief that if a H&S pattern is too big that it some how makes it invalid or not to be trusted. I’m curious how that rumor ever got started? Nothing could be further from the truth IMHO.

Below is a monthly chart of the HUI that shows a massive 6 year inverse, complex H&S base, that launched the bull market for the precious metals stocks back in 2001. There is a certain beauty that 6 year H&S base has that most wouldn’t recognize. If you look on each side of the Head you will see two chart patterns, one large blue formation and one small red formation. They are positioned just the opposite on each side of the head. This doesn’t change the time component as the left and right shoulders measures out very close to each other. At the very top of the chart you can see what that big 6 year H&S based measured to. As you can see it measured up to 690 which was just a tad higher than the actual all time high.

The Chartology of the entire chart is one of beauty and symmetry which some will see and others won’t. They say beauty is in the eye of the beholder. What do you see?

More at

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Your HUI Analysis has been Stunning !

Even I…The self acclaimed worlds worst trader…. have been doing incredibly well riding these

breakouts (nervous breakdowns as you call them ) in the Gold Mine Sector

Appreciative emails from Subscribers are pouring in

and You are so right…we don’t see analysis like this anywhere else on the Planet !

Kudos to all you subscribers (who are mostly goldbugs) who had the conviction to go into DUST

DGLD and or DSLV !

Now what ?

Stay tuned to Rambus Chartology !

Below is a chart for the HUI that shows all the patterns since this downtrend began at the September 2012 high. Today it broke below the latest small consolidation pattern the little red flat top triangle. Today marks the start of the 3rd impulse leg down since the 2012 top. The first one was the breakout of the black 5 point bearish falling wedge. The second impulse leg down was the breakout of the blue slightly expanding bear flag. And today is the start of the 3rd impulse leg down on the breakout of the red flat top. The reason your seeing a big move is because its a breakout. Notice the breakout gap this morning. This is what one likes to see when you have a completed pattern. It tells you the consolidation period is over. I can guarantee you won’t see this type of analysis or these chart patterns anywhere else on the planet except here at Rambus Chartology.

Editors Note :

I am a HUGE Goldbug…but I decided I can bitch Moan and complain..or…I can follow all the Action

with Chartology by Rambus and be on the right side for a change !

Presently Rambus’s Chartology is showing this may not be even close to Over !

why not join us for some Incredible Tutorials in PM Market Investing

Rambus is giving it to you for free for 10 days but IMHO you may as well subscribe srtaight up

either way you have everything to gain….top right sidebar

I was planning on doing the Wednesday Report on Platinum and Palladium tonight but there is some deterioration taking place on some of the precious metals stocks that needs to be addressed. I’ve been waiting patiently for a couple of the really big caps to start showing some weakness. I believe the biggest cap precious metals stocks have been hiding the retreat that has been going on in some of the lesser precious metals stocks, giving hope that a bottom is close at hand, if one just looks at the big cap pm stocks. I’ve gotten several e mails from angry gold bugs that tell me I have it completely backwards and that the precious metals stock indexes are putting in a triple bottom. I got another one that told me these H&S top patterns, that I’ve been showing you, are too big to be valid.  The amount of denial is still pretty strong among the staunch gold bugs. But that’s not what’s important. What’s important is what are the charts showing us regardless of what some folks may think.

First lets look at ABX as it’s the biggest of the big cap precious metals stocks. How it goes so goes the rest of the PM complex. Below is a daily chart that shows ABX has broken out of a bear flag and has completed the backtest move. You would have to go all the way back to August of last year to see a lower closing price vs today’s closing price.

We have to look at the weekly chart to put the daily look into perspective. The placement of the bear flag on the daily chart above is very important as its forming just above the big neckline. That little bear flag may have enough energy to move the price of ABX below the big neckline.

The long term monthly look at the H&S top. Note the multi year base that lead to the bull market in ABX.

GG is another big cap precious metals stocks that is showing some deterioration on the daily chart. After completing a H&S top last fall GG has been building out a 6 point blue diamond consolidation pattern just below the neckline. Today’s move backtested the bottom blue rail before selling off for the rest of the day.

The weekly chart shows the all important neckline, that comes in at the 32.50 area, as the bulls last line of defense that needs to hold.

The monthly look at GG is interesting because of where the H&S top is forming.  As you can see on the chart below there is an uptrend channel that has been in place since 1998 or so. If the H&S top plays out that means the big multi year uptrend channel will be broken to the downside. Also seeing a massive H&S reversal pattern sitting on top of the long term uptrend channel should give even the most bullish bulls a reason to reflect on what maybe possible if the H&S plays out. Keep in mind I’m only the messenger.

Lets now take a look at a weekly bar chart for NEM that is showing a massive H&S top pattern. This chart shows the neckline symmetry rail, parallel neckline rail,  that showed us where to look for a possible top to the right shoulder. You can also see the 4 touches, of the big neckline, in the area of the right shoulder so we know that neckline is hot and to be respected. If it gives way it will reverse it’s role and act as resistance on any backtest.

The monthly look shows our H&S top that is almost exactly the same height as the H&S top that formed just to the left.

Lets look at one more chart for NEM that is a weekly line chart. As you can see on the chart below it has been testing the breakout point of it’s big H&S top pattern. So far nothing definitive but it looks like the neckline is being backtested from below.

As I have shown you on the charts above the biggest of the big cap precious metals stocks have yet to really break below their respective necklines. Now I would like to show you some other precious metals stocks that have already broken below important topping patterns while the big caps are running interference, taking the investors eye off the ball.

AU has been trading below it’s big neckline for 6 weeks or so and has completed a backtest to the 30 area.

The AU monthly look shows the double H&S top.

BVN has been trading below its massive H&S top for 3 weeks now.

All the reversal patterns have not been of the H&S variety. Below is a 60 minute chart of FNV that shows a 5 point rectangle as it’s reversal pattern. Notice the smaller H&S pattern that formed on the backtest to the bottom blue rail of the 5 point rectangle. That’s an impressive backtest leaving no doubt that the bottom blue rail is HOT.

The daily chart shows how its reversing symmetry down as shown by the black dashed horizontal trendline that started off the September 2012 low. I could make a case for a H&S top using last September’s high and our current backtest high as a left and right shoulder.

Again we have to look at the long term chart to put everything into perspective. As you can see FNV has been in a nice tight uptrend channel since 2009. It looks like at a minimum that the bottom rail of the uptrend channel will be tested at some point in the future.

The Randgold weekly chart is showing a 5 point flat bottom expanding triangle as it’s potential topping pattern. It still has a ways to go yet but the small H&S top pattern that has formed at point #5 should get the price back down to the blue horizontal trendline.

KGC is probably one of the weakest big cap pm stocks as it’s fast approaching the 2008 low. You can see it’s reversal pattern was a 5 point bearish falling wedge. Note the failure of the double bottom hump, on the far right hand side of the chart, to hold support. The reason it failed is because of the 5 point red triangle that reversed the small uptrend.

SA shows us a 7 point diamond reversal pattern that broke down in April of 2011. It now looks like it has just created a blue bear flag that broke down about 3 weeks ago.

The AUY daily chart shows a H&S top that broke down in December of last year followed by the red rectangle that has formed just below the neckline. Its now 3 days into the breakout phase of the red rectangle.

The weekly chart shows why the H&S top, on the daily chart above, is so critical to the overall bearish picture. The H&S top has formed at the top of a 7 point rising wedge. A break of the bottom blue rail of the rising wedge will complete a very bearish picture for AUY. If you own this stock keep a close eye on the bottom rail and act accordingly it it breaks down.

I could go on and show you more bearish charts for the big cap precious metals stocks but its getting late and I think you get the picture. Folks this article doesn’t take into account the small cap precious metals stocks that have been vastly under performing the big caps. The real carnage is in the small caps right now. If you are holding any then you will know what I mean.

As I stated earlier I’m just the messenger and have no axe to grind with the precious metals crowd as I have been following this sector since the spring of 2002. I wish I could be showing you some big reversal patterns to the upside but that’s not what the charts are showing. There is no bell that rings when a top or bottom is in place. There is only hard work in understating what the charts are telling us if we can keep an open mind. All the best…Rambus

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