Four Pillars Finance

Chinese astrology cycles for market timing

Archive for March, 2010

Outlook Nasdaq and Gold stocks

Posted by Danny on March 23, 2010

Nasdaq

Current level: 2395

Since our latest outlook for Nasdaq the market has bounced back , and we are now getting close to the Metal months April-May.

We are looking for some bottom during this period, so we expect prices to fall.

In the chart we can see how the Nasdaq is climbing up in a kind of narrowing wedge pattern. And once such a pattern breaks it is quite typical to get a rather sharp decline. Look for a drop towards 2100, the recent February low. If that level breaks, then 1900.

Here is our current prediction chart (click for larger image):

Gold Stocks (XAU)

current level: 166

Gold stocks seem to have bottomed around 150 on the XAU index, but so far the climb off the lows is not very convincing.

The Earth months bottom period for gold stocks is now coming to an end.

Chinese cycles suggest a positive bias for gold stocks till June, but if the overall market falters as our analysis for Nasdaq suggests, then this may affect the gold stocks too. So it wouldn’t surprise me if the rise in gold stocks turns out to be rather weak over the next couple of months. But who knows?

Anyway, if you picked up a half position as we suggested in early February, then I would hold on and use a stop-loss near 150. That turns it into a zero risk trade.

As for buying more gold stocks I would wait till autumn, when our cycles suggest another potential bottom.

Here is the prediction chart (click to see the full size image):

Happy trading,  Danny

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