 Special SKI Report #33
Seven Index Signals in Seven Days!
Jeffrey M. Kern, Ph.D.
Email: jeff@skigoldstocks.com
USERX
| historicals
Written Feb 17, 2008
Published Feb 18, 2008
Current USERX price = 17.46,
Down 2% 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 the most informative gold site, 321gold,
since its inception approximately six years ago. 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 32 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 at http://www.skigoldstocks.com/about.php.
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.
New Material:
In the last gold
stock SKI Report on 1/27/08, I described how the gold
stocks were due to fall (at least short-term) off of the 1/14/08
high marked by a bearish run pattern and a SKI short-term index
sell signal. The long-term (multiple months to years) is more
important to profits than the short-term (a few weeks). And
SKI was still waiting to turn long-term bullish since being on
a true bull 92-96 index buy signal from mid-2005 into early September
2006. SKI HAS been on a master 92-96 index buy signal since
9/12/07 at USERX 16.15 that was NOT supposed to be a true bull
market (defined as a rise that lasts more than a year amidst
prices that at least double). That 92-96 index buy signal was
predicted (based on a pattern of preceding SKI index signals)
to sell out at some loss or some small profit, but it wasn't
time for the gold stocks to just keep going higher and higher
like they did in 2005-2006. Specifically, the last SKI Report
on www.321gold.com
predicted that, "The gold stocks are supposed to sell off
again and sell that 92-96 index over the next 1-2 weeks. IF
THAT HAPPENS OVER THE NEXT 1-2 WEEKS, SKI WILL BE PREPARED FOR
THE BIG BUY SIGNAL".
That is exactly what happened. Prices declined into 2/05/08 and
the 92-96 index sold a few days later at a small profit. The
nice thing about mathematical indices is that they can't be fudged;
I can't say that an index bought or sold when it didn't because
the mathematical formulas are public knowledge and are displayed
each day on the website.
How could I make such a prediction?
It was based upon time and the SKI indices. When I wrote that
Special Report, 93 trading days had passed since the 9/12/07
92-96 index buy signal. The name of the index is based upon
the number of trading days in the cycle. A 92-96 index compares
the current price to prices from 92, 93, 94, 95, and 96 trading
days earlier. If the 92-96 index was going to sell at some loss
or some small profit, time was up and prices HAD to decline to
sell that index out.
I don't know if other gold
analysts have described the current juncture as "hyper-critical".
I haven't seen public reports stating such, but for SKI this
is quite the moment in Time X Price. SKI has generated seven
index signals in the past 7 trading days. That is a record for
the past 34 years. I realize that many readers won't want
to be bothered with the details, but this was amazing (at least
to me). The signals have been:
1. A 16-20 index buy signal
generated on 2/06/08 indicating short-term support.
2. The all-important 92-96
index sell signal generated on 2/07/08. That ended the possibility
that the prior buy signal had marked a major bull market rise
and it opened SKI up to the next set of index signals. Jeff
(that's me) was most relieved. Despite gold bullion's major
rise, the gold stocks had languished on a relative basis and
many gold stocks (ala Steve Saville's excellent article: http://www.321gold.com/editorials/saville/saville020508.html)
still had not risen over their May 2006 SKI "death run"
high. Death runs portend very long-term declines.
3. An index that I rarely mention,
the 439-443 index, also generated its sell signal on the same
day as the 92-96 index, 2/07/08. Cycles and index signals usually
occur in bunches that are of particular significance. That index
is part of a very long-term set of indices, the 218-222, the
439-443, and the 660-664 indices. I had expected that the long-term
indices would come back into play since the May 2006 death run.
February 7th 2008 was exactly 439 trading days from the May
2006 high in USERX at 17.96. Since current prices were lower
than prices in that week in May 2006, the 443 index sold!
4. The gold stocks rose off
of the above index signals, not unexpectedly. A new master 92-96
index buy signal was generated on 2/12/08. That was an amazing
day for the index: A 3% decline in the broad gold stock measure
(USERX) would have avoided that buy signal. Gold fell about
$17. Major (but too narrow, in my opinion) gold stock
indices like the XAU, HUI, and GDX fell much more than 3%. And
yet most broader precious metals mutual funds like USERX, fell
much less than 3%. THE SIGNAL WAS GENERATED.
5. The next day the gold stocks
rose a little and the next major SKI index generated its buy
signal. The 35-39 index generated a buy signal on 2/13/08.
Can you see that now we have two consecutive cycle buy signals?
6. And then the next day, 2/14/08,
the 439-443 generated its first new buy signal in years.
7. And that same day, 2/14/08,
the short-term 16-20 index generated its short-term sell signal.
On 2/14/08, gold closed down, the general stock market closed
down, and USERX closed up 2 little pennies. A decline on that
day of 1.5% would have generated even more index signals, but
it did not happen despite gold's $20 intra-day swing and partial
collapse.
That's seven signals in
seven days into a 3-day weekend.
It just worked out that this Special report for 321gold was
due at this very moment. I tend to write with a little hyperbole
from time to time, but folks, 7 in 7 spells HYPERCRITICAL.
I was talking to my wife, Lisa,
about how to write this article. The issue was the degree to
which I state a specific prediction (as I often do) regarding
the meaning of all of those signals. I would clearly state the
predictive meaning if this was a week or more after they occurred,
but if I do it right now, I am afraid of offending (understandably)
my subscribers. And yet, I hate to write advertising articles
that don't inform. People who have been reading SKI for years
will probably be able to discern the meaning of the above index
signals. And if you read "About SKI" (http://www.skigoldstocks.com/about.php)
with some time and diligence, I think that you can guess what
I'll be saying publicly in 3 weeks. My discussions with Lisa
made me decide to solve my dilemma with simple honesty: Provide
the index data and frankly disclose that I can't state the clear
conclusion. Does that make sense? I've publicly stated this
SKI index amazing "voodoo" for years and would love
to do so here and now, but I am constrained. I hope that you
understand. With every index in play, this IS quite the gold
stock juncture. And of-course, all index signals are simply
high-probability situations; nature and the markets cannot be
guaranteed, but SKI avoids significant losses (in both long and
short positions/predictions).
My very best wishes, Jeff
If you are interested in following
and learning more about the SKI indices, I'll write another Report
for 321gold 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 messages/alerts at a slightly higher price along with
access to our informative Forum. The precious metals are in a
very long-term (decade+) up-trend but are the most precarious,
volatile, and psychologically difficult market in the world (in
my opinion). That's the way it's always been.
 SKI archives
email: jeff@skigoldstocks.com
Jeffrey M. Kern,Ph.D., is an academic psychologist with a specialty in the measurement and prediction of human behavior. The communications provided are for informational purposes only and are not intended to be investment advice or recommendations for specific investment decisions. Dr. Kern is not a registered investment advisor, but is registered as a commodity trading advisor (CTA). The information provided is considered accurate, but cannot be guaranteed. Investments/trading in narrow market segments or gold futures is for individuals willing to accept a higher level of risk for the opportunity of greater returns. Past performance is no guarantee of future performance. His website is www.skigoldstocks.com.
Communications should be sent to: jeff@skigoldstocks.com.
Copyright © 2002-2024 Jeffrey Kern. All Rights Reserved.
321gold Ltd
|
