 Market Thoughts
And Timing
Gold, Silver, HUI and Timing
Ron Rosen
April 29, 2005
"Time is more important
than price; when time is up price will reverse" -W.D. Gann
"There is an appointed time for everything. And there is
a time for every event under heaven..." -Ecclesiastes 3:1
Ah Yes, that old bugaboo timing.
I think it was that ancient comedian, long gone, Henny Youngman
who said, "Don't tell me what to buy, tell me when"
This old timer, yours truly, has been bumping his gums for some
time that gold bullion and Gold shares are on different time
schedules. The shares topped in December 2003 and have been correcting
ever since. That's almost 17 months since we were given a warning
that things in the precious metals share market had changed.
It was the monthly chart of the HUI that sent the message. A
completed near-perfect bullish 5 wave monthly move was the key
to a proper interpretation of which way the HUI was headed, and
the direction was down. The decline is in its final leg down
and I expect this decline to finish its work sometime this summer.
Not so for gold bullion however.
I have included a Delta chart that shows we are not due for a
bottom in Gold bullion until some time between the end of this
year and July 2006. Gold bullion topped in December of 2004 and
has more time to correct as I see it. The gold shares performed
their usual function of warning us of a change in the precious
metals environment. I read about some folks buying now because
the Gold shares are cheap and represent value. They are bottom
fishing. I never could understand why folks would buy a stock
that is going down in price. I always preferred to buy stocks
that were going up in price I guess they think they know when
these stocks will bottom, turn around and go up. Or they believe
current price represents value. If I want to get on a train that
is going north, I am not going to get on or recommend getting
on one that is still going south. I am not smart enough to know
ahead of time when the train will stop and turn around. However
after 50 years of mucho mistakes and studying and observing I
have learned to look for certain signals and messages. The Delta
turning points have made this job so much easier. It seems that
the tops and bottoms of key Elliott waves correspond with Delta
turning points. That observation has helped enormously.
I have recently stated that
silver is a "bitchy" metal. After today's
performance of a 23 cent "Swan dive" "I think
you know what I mean. Where are all the silver bugs when needed?
"Silver to da moon," "There's no silver left anywhere,"
"Silver will sell for more than gold." Maybe, but it
better make a three point landing first. We may be due for an
oversold rally in the P.M. shares but I don't count on it. The
HUI Delta chart I have included with this report shows that a
potential bottom is due around May/July. Since May is almost
here, I will be looking closely for bottoming clues and - most
importantly - evidence of turn-around. I know with absolute
certainty that I will not be able to pick the bottom to the day.
Instead, I will need evidence of a turn-around to make a buy
recommendation, and that comes after a bottom not with a bottom.
The picture of the Yacht, Patience,
heads this report because "Patience" is one of the
most important ingredients of success in the markets. That does
not mean a lot of time must be consumed. What it means is;
"THE MORE PATIENCE YOU
HAVE THE FASTER THINGS WILL HAPPEN."
Internalized patience is a
necessary ingredient for success in the markets. This does not
mean buy and hold forever. It means patience once internalized
helps eliminate fear and allows you to see clearly. The Yacht
Patience is a 30 foot all Teak diesel powered motor sailor and
has been a part of my family since 1965. Patience is currently
owned and Captained by my son in Connecticut. He and I took many
father and son voyages on Long Island Sound. As a matter of fact
we both grew up on that vessel. This weekend I will be forwarding
a report, with Delta charts, on crude oil and the Dow Jones Industrials.
Stay Well.
(Click on
images to enlarge) April 28, 2005
Ron Rosen
email: rrosen5@tampabay.rr.com
Disclaimer:
The contents of this letter represent the opinions of Ronald
L. Rosen. Nothing contained herein is intended as investment
advice or recommendations for specific investment decisions,
and you should not rely on it as such. Ronald L. Rosen is not
a registered investment advisor. Information and analysis above
are derived from sources and using methods believed to be reliable,
but Ronald L. Rosen cannot accept responsibility for any trading
losses you may incur as a result of your reliance on this analysis
and will not be held liable for the consequence of reliance upon
any opinion or statement contained herein or any omission. Individuals
should consult with their broker and personal financial advisors
before engaging in any trading activities. Do your own due diligence
regarding personal investment decisions.
321gold Inc
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