“Those who have knowledge don’t predict. Those who predict don’t have knowledge.” Lao Tzu, Chinese philosopher, 6th century BC


Sunday, 4 August 2013


I have circled the patterns of interest in the following charts.  We will use gold and silver to show the current patterns showing up in the markets, and looking at gold and silver we can then guess as to what type of move will come next.

The patterns showing up in Gold and Silver currently are far ahead than all the other markets.  If one is to look at the breakdown of where other markets sit, we can see that we are at about the 1-2 1-2 zone now of where the metals used to be.

Looking at Silver you can see where I labelled 1-2 1-2 just right after the new year.  So far the counts have been prefect and still have one more stab lower along with Gold. Notice also that most markets look like the patterns formed by the precious metals during its 2011-2012 run.

Previous to the circled patterns below we can see the top formed is similar to the said formation the precious metals made during the 2011-2012.

These patterns are also seen in the HSI as a 1-2 1-2 and we could be at the brink of collapse. Notice the pattern before it.

Again on the TSX we manage to put 2 lower zigzags that could be measured by a 1-2 1-2 count. Not to mention the Head and Shoulder pattern that is quite blatant.  If that doesnt scream technical breakdown then I dont know what everyone is looking at.  Since Canada is known for its resource, and finance the only thing I could see is that stocks will follow.

Again the whole pattern circled here for example is eerie of the patterns formed by the precious metals, but much more stretched out.  So I would caution those who have turned bullish who cant wait for the bear markets anymore.  It seems more and more bear are giving up now, and this posts should reassure them otherwise.

 Similar 1-2 1-2 patterns...

Here are the bonds who seem to be ahead of the markets and have already past the point where the 1-2 1-2 pattern have been produced.  Did you notice the impulsive manner of the price right after the 1-2 1-2 pattern?
There are more but these are just a few of the major markets that have been trending.  So looking at the US index and its equities we can tell that they are stretching beyond the economic means.  They have been diverging from the whole world and they will have to follow and not the other way around.  EEM above is following and that includes China.  I just don't see the bullish argument on a near term basis.

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