Current USERX price = 9.03, Up 33 cents (3.8%) 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, 11/17/19, maintained that the 10/15/19 16-20 index’s buy signal continued to the SKI-theoretical low at USERX 8.30 and that “The bull needs USERX (and HUI) to generate the new 35-39 index buy signal soon and to be at least 4% higher (from today’s price) in 7-11 trading days to stay above the prices from 92-96 trading days earlier…Seriously”. That WAS “serious” and exact.
The gold stocks then meandered a little higher into 11/20/19 before declining another time into 11/25/19 at USERX 8.48. New simultaneous 16-20 and 35-39 index buy signals executed that day, 1-cent above the prior low of 8.47 on 11/11/19.
More importantly, the time period of 7-11 trading days from 11/17/19 was running out. There were only 1-5 trading days for USERX to be at least 4% higher than 8.70 to maintain the SKI bull market’s 92-96 index’s buy signal. That index was NOT SKI-supposed to sell. USERX was SKI-supposed to rise and avoid falling below the prices from 92-96 trading days earlier.
On 11/25/19, the 92-96 index’s back prices were 8.16, 8.20, 8.27, 8.22, and 8.55. Therefore, USERX’s closing price of 8.48 began to move the 92-96 index towards a sell signal. USERX “had to” rise to maintain the bull market.
On 11/26/19, the 92-96 index’s back prices rose to 8.20, 8.27, 8.22, 8.55, 8.96. USERX reversed higher, as needed, to close at 8.69, but that was still below 1 of the index’s 5 back prices. The rise “needed” to continue.
On 11/27/19, the 92-96 index’s back prices rose to 8.27, 8.22, 8.55, 8.96, and 8.98. USERX edged higher that day to 8.71 (despite a 0.7% decline in many gold stocks ETFs) due to USERX’s unique mix of Australian, Canadian, U.S., and South African holdings. But that was now below 2 of the index’s 5 back prices. The rise “needed” to continue again.
On Thursday, 11/28/19, the U.S. market was closed for Thanksgiving. Therefore, USERX did not have a closing price. But the Canadian gold stocks were trading and rose solidly providing a solid positive bias going into Friday.
On Friday (11/29/19), the gold stocks rose solidly. USERX closed at 8.90. The 92-96 index’s back prices rose to 8.22, 8.55, 8.96, 8.98, and 9.10. Therefore, USERX had now closed below 3 of the index’s back prices and “needed” to continue to rise.
On Day 10 (from the prior Report; specifying the 5-11 trading day period), Monday (12/02/19), USERX rose for the 4th consecutive day to 8.96. The 92-96 index’s back prices rose to 8.55, 8.96, 8.98, 9.10, and 8.94. If USERX did not rise to above 8.96 the next day (Day 11), the master 92-96 index would generate a bearish sell signal to end the SKI bull market from June 2019.
And then on Day 11, as time ran out, the gold stocks gapped higher and continued to rise on 12/03/19. Jeff did NOT know if that open up-gap would get filled on a short-term decline, but the 92-96 index’s sell signal was avoided (as expected) on the last possible day to maintain the SKI bull market. Such precision is not unusual but it is enough for the market X SKI to make me lose some hair…
The above exact maintenance of the SKI bull market’s 92-96 index buy signal does NOT guarantee that the bull will continue, but it is “SKI-supposed to”. And it might make you come around to Jeff’s absolute belief that the gold stocks are not moving “randomly” via “news, etc.”: The gold stocks behaved exactly as needed, day-by-day, to maintain the bull market. This past Friday’s (12/06/19) decline to USERX 9.03 has moved the 92-96 index a little towards the UNwanted sell signal because the index’s back prices had risen to 8.94, 9.13, 8.92, 8.92, and 9.03.
I can conclude that the bull market cannot be killed on this coming Monday (12/09/19). But a 2-day decline to below USERX 8.70 would likely generate the bull market’s sell signal. And 3 days below USERX 8.92 would also likely generate that Mechanical SKI sell signal. The exact numbers after Monday do depend upon Monday’s closing price. The index’s sell signal is not “supposed to” occur because USERX and the HUI are on SKI bull markets from June and have been making higher lows and higher highs since the 10/15/19 exact “correction low” (despite “crappy” silver and somewhat “crappy” gold; plus non-bullish COT Reports). That WAS supposed to be THE low and it has been (so far)…
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 $30 (for a one month subscription) or more ($240 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.