Since the late 1960s, gold has generally seen major lows every ~8 years, and major tops ~11 years after major lows.
As depicted below, we saw a double bottom in gold in July 1999 and April 2001. Splitting the bottoms gives us a May 2000 start date for the 11-year cycle. Which means we should expect the next major top in gold around ~May 2011.
This projection squares well with the Gold Money Flow T discussed below, as well as gold's seasonality in which important tops are often made in the Spring. See, e.g., May 2006 and March 2008. Finally, it also correlates with the end of QE2 as well as Martin Armstrong's 8.6 year cycle turn date in economic confidence (June 2011).
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Parker, this is a good alert so that all can be ready. If it honors its 11 month cycle it should be dropping down into Jan/Feb and then launch its last rally.
ReplyDeleteI wanted to highlight a potential signal to all your readers on the NYSE McClellan Summation Index on Stockchart.com. Today it appears to have started a short term breakdown from the "ledge" that it formed over the last two weeks. Tomorrow's follow thru will be required to confirm it. It appears to be happening in tune with your MFI target later in the month.
Parker,
ReplyDeleteAfter reading your postings about where to put the middle of a T and where to start a T I attempted to program this logic. Below is output from the program when using 2 etfs based on gold and silver.
gld
starting low at 2010-04-16,110.54
this is a rising money flow t
midpoint date is 2010-09-29, close 127.95, mfi 88.63, number of days is 166
projected end is 2011-03-14; projected close 145.36
slv
starting low at 2010-03-25,16.25
this is a rising money flow t
midpoint date is 2010-09-20, close 20.29, mfi 85.62, number of days is 179
projected end is 2011-03-18; projected close 24.33
usacoder
ReplyDeleteOn the GLD daily chart, I have the center post on October 1. The Money Flow T that began on July 28 correctly called a top on December 7.
Using the same center post and the Feb 5, 2010 low as a starting point, I get a top on May 24, 2011 which jibes with the 11 year cycle noted above.
SLV has a similar long range daily MFT with a start on Feb 5 and a Sept 29 center post.
Using the weekly SLV chart starting the week of August 16 and using the week of Nov 8 as a center post yields a target end date the week of Jan 31, 2011.
I have not found that MFTs are capable of projecting price targets, just time targets.
Of topic, but I'm curious what this method has to say about the last hated commodity, nat gas.
ReplyDeleteSince I use natural gas to heat my house, tracking UNG (Natural gas ETF) serves another purpose : whether to pay the market rate or buy a contract (fixed rate) from my utility company. So far I have stayed with the market rate, but I will switch if it starts trending upwards.
ReplyDeleteParker, are the 8yr and 11yr cycles you use part of the cycles work of Francis Bussiere?
ReplyDeleteJustSignals
ReplyDeleteI'm not sure who originated the concept. I first read about it from the Aden Sisters.
Then you may want to see other gold and silver cycle charts on astrocycle.net
ReplyDeleteThis morning I made more changes to my program (it's an ongoing/iterative process). Here's an update of the output.
ReplyDeletegld
starting low at 2010-07-28,113.08
this is a rising Money Flow T
Center post date is 2010-10-01, close 128.91, mfi 90.47, number of days is 65
projected end is 2010-12-04; projected close 144.74
slv
starting low at 2010-06-04,16.94
this is a rising Money Flow T
Center post date is 2010-09-29, close 21.4, mfi 93.61, number of days is 117
projected end is 2011-01-23; projected close 25.86
I realize that MFTs don't predict prices - I just added that to give me an idea where the price may be on that date. The price prediction is simply the price of the start minus the center post price with the results added to the center post price.
remeber when reading astrocycle gold charts. He has Jan 12 date on both daily as well as monthly chart. On daily Jan 12 refers to Jan 12 as date in 2011 and on monthly Jan 12 refers to Month January 2012.
ReplyDeleteI don't know what he is expecting on Jan 12 on daily chart .. high or low... but if parker has peak in early Feb, I guess Jan 12 2011 may be bottom and then it will take off.
Hi Parker,
ReplyDeleteso was the SPX MFT wrong in predicting a Dce 8 top? and now it is early Feb top?
Parker,
ReplyDeleteThanks for all your work, its very interesting.
Correct me if I'm wrong, but comparing your top date to Terry's, ie. Gold, I thought he called it a 40 year total cycle, top to bottom to top. He said it started 2000 - 2001 to run 20 years or so, so it would top out approximately 2020.
Are you suggesting the May 2011 is a pause only, and will rebound or the end of the bull?
Thanks again.
mxim
ReplyDeleteDec 6-8 appeared to be a turn date in a lot of things. About the only top that was correctly forecast was gold.
Mark
Yes - May 2011 would be an interim top. If you will notice, there was an important 8 year low in November 2008. 11 years from that date should provide a late 2019 final top for gold in accordance with the 20 year cycle.
"date projection (~12/20) is likely more accurate than the price projection (~1336)" has something changed to this prediction Parker?
ReplyDeleteRodd
ReplyDeleteNope.
1X1 still down at the 1350 FEB Gold!
ReplyDelete