Wednesday, October 04, 2006

HUI / GOLD Ratio.

The HUI chart might look kind of ugly after the latest dump but technically nothing of great significance had happened. The HUI like most other gold and silver stocks indices did not go below the June lows.

Closely examining the Hui/gold ratio, notice the wave count and the implication of the wave count if true – a strong rally which should follow once the washout is over and the ABC (wave 2) correction is over. So, yes believe it or not I'm thinking a strong and sustained gold rally is just around the corner. There are many good fundamental reasons for that and the technicals are slowly creating the perfect opportunity for long trades on many time frames.

Going forward gold / silver and PM's Investors and traders should pay attention to the following market information:

1) The spot and future price of gold and silver.

2) Mining indices : HUI , XAU , GDX, GOX.

3) The price of other precious metals (palladium, platinum. etc.)

4) The price of industrial metals.

5) The price of oil and the energy complex.

6) Interest rates and currencies.

7) General commodities markets

hui/gold ratio chart

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