Current USERX price = 6.86, 7.20, Down 34 cents (4.7%) since the last report 4 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 March 28, 2019) was an unusual exact copy of the subscriber daily email for that day. At that time, USERX had dropped to 7.20 and the situation was bearish. The 35-39 index was highly likely to generate a sell signal in two trading days (for execution the following day, on 4/02/19). At the same time, the supportive 16-20 index was moving towards its next buy signal that needed a decline to below USERX 7.07 to generate. And the USERX run pattern was at 2 Up and 2 Down: A continuing decline for 3 or more trading days would form a special 2 UP and 5 Down run pattern that usually mark lows.
Therefore, IF the gold stocks dropped solidly for another 2 trading days, there would be a tied 16-20 index buy signal and a 35-39 index sell signal executing on the 3rd trading day (4/02/19). Such tied index signals usually mark a low. And if USERX declined for 3 additional trading days the special run pattern would also form for a potential low on 4/02/19 (as soon as the run down ended)
The gold stocks then declined just a little on 3/29/19 for a 3rd consecutive daily decline, but USERX did not go below 7.07 (closing at 7.19, down just 1-cent). USERX would need a solid drop below 7.07 on Monday (4/01/19) to generate the tied index signals for execution on 4/02/19.
The gold stocks opened a little higher on 4/01/19 but then continuously declined. Yes, USERX dropped 2% to close at 7.05. THE CLOSE BELOW 7.07 WAS SKI-PERFECT BECAUSE IT GENERATED THE TIED INDEX SIGNALS FOR EXECUTION THE NEXT DAY (4/02/19) AND THE RUN DOWN HAD EXTENDED TO 4 CONSECUTIVE DAYS. Finally, while the HUI rose a fraction on 4/02/19, USERX closed down 1-cent to 7.04. THE TIED INDEX SIGNALS AND THE SPECIAL RUN PATTERN WERE HIGHLY LIKELY TO HAVE MARKED A LOW ON 4/02/19. SKIers were “allowed to” buy when the gold stocks rose on 4/03/19 because the stop-loss on such a buy could be identified as any USERX close below the 4/02/19 low of 7.04.
I provided that special 321gold report on 3/28/19 because I wanted to demonstrate for the umpteenth time that not every financial analyst is a “scammer” and that “some mathematical analysts do know something”. And so it was that the decline into 4/02/19 marked a low.
The ensuing rise only persisted for 5 trading days as the gold stocks rose 5%. The rise into 4/09/19 to USERX 7.38 formed a potential 1 Down and 2 Up bearish run pattern as another index signal also executed to mark 4/09/19 as a potential technical point. When USERX declined on 4/10/19 to 7.32, the bearish run pattern completed.
And then the gold stocks just kept declining. USERX (but not the HUI) declined for an unusually extended 10 consecutive days into this past Tuesday (4/23/19). That yielded yet another instance of the special 2 Up and 5+ Down run pattern that completed the next day (4/24/19) as the gold stocks rose. As Jeff always writes, one has to follow USERX (with its special characteristics) to identify the run patterns. And once again, when USERX rose 1% on 4/24/19, SKIers were “allowed to” buy because a stop-loss could be identified (i.e., any close below the bottom of the run down at USERX 6.66).
The decline on last Thursday (4/25/19) held above USERX 6.66. Therefore, the stop-loss was not activated. And then there was the solid 2.7% USERX on Friday (4/26/19) to 6.86.
Now, the immediate trend should be higher as long as USERX remains above the 6.66 sell-stop. AND THE 4/23/19 LOW MAY HAVE BEEN AN INTERMEDIATE-TERM (MULTI-MONTH) LOW. A specific run pattern over the next 2 trading days would historically predict such a low. That pattern is specified in this past Saturday’s (yesterday’s) SKI Update (reserved for SKIers). We’ll see. And in a few weeks, SKI could/may provide either a true bull market (for the first time since January 2016) OR a very bearish index pattern. Obviously, if the next 2 trading days provide evidence of an intermediate-term low, then the bull would be expected to develop.
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.