Current USERX price = 8.88, Up yet another 99 cents (12.5%) since the last report 3 weeks ago..
Introduction (repeated from prior Reports):
I have been using my unique SKI indices to predict price changes in the precious metals' market for more than two decades. And my indices continue to mark the critical points. I have initiated a subscription website since 1/13/06 (yes, Friday the 13th) after having posted free updates for years at www.321gold.com. SKI is a timing service; although almost everyone seems to believe that market timing is impossible, that IS what the SKI indices have done for 36 years.
The SKI indices contain short-term (16-20 trading days), intermediate-term (35-39 trading days), and long-term (92-96 trading days) indices. A more comprehensive description of these mathematical indices and their history is found here. Basically, the indices compare today's price to prices from a specified prior time period. The name of the index specifies the time period (e.g., 92-96 index = compare today's price to prices from 96, 95, 94, 93, and 92 trading days earlier). Although I use the oldest gold mutual fund, USERX, for analyses, the predictions are applicable to the broad precious metals' market. I do not recommend or analyze specific stocks, but my subscribers from around the world regularly discuss individual issues on our Forum. In addition to the truly unique SKI indices, I also use "run patterns" to guesstimate turning points in the precious metals' market. A "run" refers to a pattern of daily up and down market closing prices. If the market has 3 consecutive days of higher closing prices, the run is "3 up". If prices then decline for 2 consecutive days, the run becomes "3 up and 2 down". If prices then close higher the next day, the run changes to "2 down and 1 up". Some people have referred to run patterns as "worms". A run pattern is only completed after the direction of closing prices has changed. I have compiled a listing of every run pattern that has ever occurred and generated probabilities that the end of the run marks a high or a low, moderated by the indices themselves.
The last SKI Report, written on Sunday 1/22/17, described the high likelihood that a short-term top had occurred: “The combination of the two index signals and the bearish run pattern suggest that a wave 1 top occurred on 1/17/17 at USERX 8.08 off of the major intermediate-term low in December 2016. Jeff’s looking for a short-term decline into SKI-index support (a wave 2 down) for the beginning of another strong rise (a wave 3 rise)”. More importantly, that Report concluded that “I certainly expect that the next buying point should occur prior to the next SKI Report in three weeks”. But the expected/predicted time and/or price to buy was reserved for SKIers.
After that Report, the gold stocks immediately surged higher on Monday (1/23/17) and it looked like USERX might close over the prior high of 8.08. But it did not do so, closing exactly back up at 8.08 (smile). And the next morning the gold stocks gapped much higher, making it appear that USERX was surely going over that 8.08 SKI-marked top, but the gold stocks then lost all of their daily gains with USERX closing below 8.08 (at 8.07; smile). That behavior continued to reinforce the prediction that a short-term high had occurred at USERX 8.08.
The subsequent decline went back down to USERX 7.85 and Jeff was looking for one more push down to hit SKI index support for the next time to buy. Although I refrained from specifying the expected/predicted time for such a buy in the last 321gold SKI Report, it was expected to occur right around the 2/01/17 U.S. Federal Reserve announcement based upon the indices’ back prices. With USERX sitting at 7.87 on Monday, 1/30/17, the buy was going to occur within a couple of days on either a quick hard drop below USERX 7.83 OR a close over USERX 8.08 (for a “bullish break-out”).
USERX then surged higher on Tuesday, 1/31/17, right before the Federal Reserve announcement, and a special Intra-Week Buy Update was sent as USERX closed just over 8.08. Here are some excerpts from that SKI Update:
“SKI Intra-Week Update 1/31/17 4 PM PST
The gold stocks and gold then declined in the morning of 2/01/17 and one was supposed to buy.
The last public SKI Report for 321gold warned readers that the next buy-point was highly likely to occur PRIOR TO this next Report. That technical point generated on 1/31/17 and the gold stocks have basically gone straight up 10% in 1.5 weeks. If for some reason you don’t believe it, and/or you want to hear some additional predictions, listen to Jeff’s 2/02/17 interview with Jordan Roy-Byrne (that was delayed one day in deference to SKI subscribers): SKI Gold Stocks Trading System Current Prognosis. When my eldest son listened to that interview, his reaction was “Gosh, Dad, you sound excited”. I was and I am…
The gold stocks are now approaching the stated intermediate-term upside target of a USERX (and HUI) 92-96 index signal. Look back 92-96 trading days (which I of-course do for SKIers regarding all of the SKI indices) and you’ll see that USERX (and the HUI/GDX) should generate that resistance index signal before (once again) the next public SKI Report in 3 weeks. That index signal has an 80-100% historical probability (based upon the index signals since 1974) of yielding an intermediate-term (1-2 month) top.
Nothing can ever be “guaranteed”, but Jeff is preparing to sell. Even more importantly, if the index signal yields the expected intermediate-term top, a subsequent decline will maintain the set-up for a true SKI 92-96 index bull market that could very well exceed the 100% rise that was correctly projected from the January 2016 bull market buy signal. That’s why Jeff remains “excited” at the extreme bullish prospects going forward, but such an extremely bullish index signal has not yet occurred (as per the linked interview above), and requires (yes, SKI would “require”) an intermediate-term decline.
Cheers and Best Wishes, Jeff
If you are interested in following and learning more about the SKI indices, I'll write another Report in three weeks or you can shell out the big bucks for a SKI subscription. Weekly Updates are available by subscribing for a month (or longer if you're wise and cheap enough to want to save money) at my website www.skigoldstocks.com for the princely sum of $25 (for a one month subscription) or more ($200 for an annual subscription). I also provide more frequent intra-week daily messages/alerts at a slightly higher price along with access to our informative Forum.