Special SKI Report #153
Gold Stock Update

Jeffrey M. Kern, Ph.D.
Email: jeff@skigoldstocks.com
USERX | historicals
Written May 3, 2015
Published May 4, 2015

Current USERX price = 5.82, Up 34 cents (6.2%) since the last report 3 weeks ago.

Introduction (repeated from prior Reports):

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.

New Material

The last gold stock SKI Report, written on Sunday 4/12/15, was bearish due to a simultaneous Double Sell index pattern that generated on 4/06/15 and executed on 4/07/15 at USERX 5.47 and gold $1210.60. The caveat was that multiple new index signals could easily be generated. That SKI Report also noted that there had been a meaningful USERX run pattern: A rise over the top of the 3/24/15 5-day-Up run pattern at 5.59 would suggest renewed bullishness and a decline below the bottom of the 3/31/15 5-day-Down run pattern at 5.28 would suggest renewed bearishness.

Since that last SKI Report, the gold stocks rose. USERX rose over 5.59 on 4/15/15. That caused Jeff to cover shorts at a small loss.

And there have been multiple new index signals. USERX rose into a XXed Out 35-39 index buy signal on 4/20/15 at USERX 5.65 and a 92-96 index buy signal on 4/21/15 at USERX 5.70. Since the 35-39 index buy signal came BEFORE the 92-96 index buy signal, the 35-39 index buy signal was On the Path of Trades. It WAS a “buy” signal, but the XXing Out suggested that prices would decline and that the buy signal would sell at a loss. The gold stocks did decline again on a short-term basis after those index signals to generate a 35-39 index sell signal on 4/23/15 at USERX 5.65. That sell signal sold the XXed Out buy signal at break-even and opened the Path of Trades once again on 4/23/15 at USERX 5.65.

And then the gold stocks rose again into yet another 35-39 index buy signal that executed this past Wednesday (4/21/15) at USERX 5.94. The index had once again marked the day of the U.S. Federal Reserve announcement as another meaningful technical point.

Conclusion

The SKI indices have been marking several points during the past month as a potential rebound top from 3/10/15 low at USERX 4.94. The Double Sell index pattern reported in the prior SKI Report has continued to mark the high for gold, but the gold stocks have shown bullish relative strength and have risen into an index buy signal on “Fed Day” (4/21/15).

That 4/21/15 35-39 index buy signal was On the Path of Trades and was not XXed Out. Therefore, it may have marked an intermediate-term (several month) bullish breakout. And yet, such 35-39 index buy signals are not true bull market buy signals and truly “can” mark a high to within one day. So far, it has marked the exact high, but it’s only been two trading days since that index signal. Therefore, it’s the sell-stop on such a 35-39 index buy signal that matters.

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 messages/alerts at a slightly higher price along with access to our informative Forum and a managed gold futures program. 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