We all get it wrong, sometime. But when you say ‘Exxon Mobil: A Great Big Buy’ on JUN 3 when the stock price is at dollar 88 near all time historical high at 93, you must be neck deep in Oil data and rig reports, unaware of everything else. Everything linked with OIL prices, linked with mass psychology extremes, linked with risk management etc. This is not just the Business Week star analyst GENE MARCIAL who said this, but we had many other star analysts there from Lehman, S&P Research (Strong BUY) and even Motley fool, which predicted stunning Q2 earnings for Exxon on July 30. Prices fell 41% from the top.

Well! we repeat, everybody gets it wrong, sometime. But a STRONG BUY crown is hard to throw once you have worn it at an all time top. Readers will remember you. And by the way, we at Orpheus got it right on EXXON, CHEVRON, XLE, BRENT and the OIL complex. We were cautious from dollar 125-135 OIL, but then we rather be cautious than wear the FOOL’s CROWN, which is really scary and tough to avoid sometimes. We are sorry guys, it’s a fool’s game, better luck next time. Try looking at stupid charts, fractals, sentiment, cycles, intermarket and exponential curve in statistics, it might help. THE OIL ROCKET written on MAY 2008 found us alone, thankfully. And we were negative on CHEVRON and EXXON from near dollar 80 levels on both WAVES.GLOBAL and WAVES.OIL. We have carried both the stocks every issue, carrying anticipated and happened cases. On 10 May 2008 we said, “OIL is headed to sub 100 and potentially lower till 70 and our research IMPULSE shows more of a PUT than a CALL”. Look at your mailbox you definitely would have a mail from your broker, giving you NYMEX BRT CALL OPTION premium rates, back then. There were many reasons we could see this coming apart from common rare sense and understanding that rockets are linked with euphoria and crash down. We mentioned above Oil vs. Gold Intermarket relationship, which was highlighting an impending underperformance on OIL compared to Gold (SLIDE 5). This happened.

Now let’s look at some alternative, non conventional research observations. First, the intermarket leadership of equity vs. it’s underlying commodity clearly suggested that XLE, CHV and XOM were not rising up with OIL. The classic extension of CHARLES DOW’s non confirmation rule in the DOW THEORY of 1884. Exxon was stagnant from July 2007 unlike OIL, which was excited. Second. Prices reached previous MINOR 4 waves resistances (SLIDE2) and the impulse was down and the corrective up. Third. Now prices have broken primary channel lows (SLIDE 11) on BRENT and the fall does not seem over yet. We could indeed push till dollar 60 and potentially lower till (4 circle primary at 50 – low probability scenario now). Fourth, We have 0.618 FIB levels met on few components of the OIL complex. This suggests some short term pause on XLE. But sub 45 we continue to look down till 34.

On the last note, NATGAS another key ENERGY component is back to where AMARANTH left it with 6 billion dollars of losses and a bankruptcy. Prices are back at a four year low. This is a place where there is no euphoria, not much news, no strong BUYS, a classic no noise accumulation signal. We will keep you posted when it turns to a BUY.

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WAVES.OIL is a perspective product published once a week. The report covers BRENT, WTM, XLE (Energy SPDR), top energy stocks, Natural Gas and related FUTURES. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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Author: Orpheus | Date: 20 October 2008 | Comments (0)

Categories: Accuracy Energy, Energy

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The last time we covered GOLD was when it was ranging between dollar 920-950 levels (FOOL’S GOLD). Well we have had a financial crisis and so much activity since then. But the crisis commodity is still sub 900. And as anticipated it did push lower back to sub 800 levels till 730. What happened? Why though the world talked about GOLD, the final hedge, the capitulations and the panic, there were historical volatilities, the destruction of real money, implosion of capitalism, the crisis commodity just did not move up? Why is it sleeping? This is another question which we may not understand.

Though we all have an opinion, it’s the time forecast which traps most of us. Gold is forever, but when to BUY is the only question that matters. 21 Apr 2008 was not a good time to be in Gold and it’s been six months since we said that, saving you the heartless wait and prayers of rises and hope that the crisis would push up gold. But Gold remains there, stay put, doing its own thing, keeping us on tenterhooks.

So what now? Now that crisis is here and Gold has not budged. What is the opinion on Gold? When is it maturing? Assets just like everything in nature have a prime and decay. Assets have a larger life than humans, as they are generational. This is why understanding the asset cycles need generational knowledge, also known as history. We at Orpheus call these generational knowledge as cycles. They work generation to generation, rarely eliminating themselves as along with generational wisdom there are generational mistakes, which we repeat as an aging or growing society. Gold symbolizes this generational knowledge and mistakes very well.

Gold is one of the oldest assets and has many short term and long term growth and decay time cycles affecting it. Understanding the gold cycle can tell us about the society as a whole and about the metal itself. The Gold cycle answers the question of WHEN very well. The current gold decay is of a shorter time. The asset is in an ongoing multiyear growth cycle, which we have highlighted prior could extend well into 2012-2015 time window. The Gold 30 year cycle (THE GOLD CYCLE) has been documented since 1869, with 75% of the Gold mined after 1910. The cycle sequence goes from 1869, 1907, 1934, 1973, 2000 and 2030. The 30 year up cycle started in 2000 and should continue for three decades. Even the most conservative estimates pitch gold near dollar 3,000 levels.

Before we see how low can GOLD go before it starts the big move up, let’s see what does Gold 3,000 mean, how valid the number is, and how this number defines the economic cycles ahead. First and foremost. Gold leads the commodity group. The CRB vs. GOLD relationship suggest that GOLD might continue to outperform the rest of the commodities. And the way we see things, the gold outperformance might continue till the cycle high in 2015. This seems more reasonable when you see the last time gold underperformed commodity complex was starting 1980. Second. Just like Oct is not just a calendar year, 1980 commodity top is very significant to understand generational cycles. 1980 was also a 60 year interest rate peak. And after the coinciding interest rate and commodity peak, 1980 also marked the half of the 1970 and 2000 Gold Cycle. This is why 1980 is much more significant than the 2008 top on Gold. 2008 is barely 1/3 of the 30 year cycle. Third: We all know what the Gold top of 1980 did. It ushered in a secular fall in gold and commodity prices and created a boom in equity markets. This is why connecting GOLD drop with equity crash is a lot different now. And means much more than deflation. Fourth: Market Cycles are crisscrossing across assets and we are in a period of excess hot leverage credit. A contagion can catch the markets by surprise, and that’s what happened, an energy gap. After which markets start searching for a balance. ‘Energy gaps’ are a much used jargon among cyclists. Fifth: The reason deflation may not happen is because not all Strauss and Howe lows coincide with a Kondratieff low. Strauss and Howe crisis alternate between deflation and accelerating inflation. This is why the previous Strauss and Howe metacycle deflationary low of 1946 should alternate with an inflationary cycle that should push until 2030 marked by a world war (every Strauss and Howe lows have witnessed a war). Sixth: In terms of actual price performance gold has been an outperformer against most cross assets till now. Seventh: The commodity fall was expected. The oil rocket we highlighted in MAY seemed ridiculous then, not now that Oil has collapsed by half. Alternative energy is not yet here and neither have we stopped consuming. To expect OIL journey up over also seems too easy an explanation. Above this, interest rates have not peaked yet, food is starting the next leg up and sentiment is at an extreme. This all suggests that even if the commodity revival may take a few months more, equity should start moving up in its last reprieve for the decade soon.

All these reason suggest that even if may get the jigsaw right, we might have muddled the timing again. And then there is the psychology aspect. The Dow psychology aspect we discuss last time, might still look a strange reading, but ask a trader who traded NIFTY futures after 12% historical up move on DOW (15 Oct). He lost money buying NIFTY Futures on the way up. And then ask the trader who sold NIFTY Futures the next day (16 Oct) with a 10% down day on DOW. He too will accept that his shorts hit stop loss. You cannot change mindsets, till the time you lose money. Maybe even losses might not teach us. But then still we have a higher chance to learn when we fail and lose. News and psychology are linked. If Ronald Reagan, President Hoover and Paulson talked about strong fundamentals and strong banks before the collapse of 1929, 1987 and 2008 than what use is information and news anyway. And who are we in the information chain?

When fear takes over, fundamentals are thrown out of the window. And messes start to unravel. Markets don’t know balance and are are all about extremes and extremity by very nature is unsustainable. This is why cycles work. We will not value nature and alternative energy till OIL goes to dollar 500. We will not balance the current credit expansion till Gold trashes paper money. The Gold inflation has just started. We won’t value nature till water becomes more expensive than OIL. Markets are the best teacher and equilibrium creator because we humans can’t balance between ethics and greed.

In conclusion the Gold corrective still points lower and we will not be surprised if it retests 700 levels. If it did not crack up with all the crisis behind it, the cycle could still be bottoming and may take a few more months. Meanwhile OIL below 70 brings it 50% down exactly from the point where we were crying for 200 dollars per barrel (THE OIL ROCKET). DOW cracked 10,000 as expected, but surprised us with the sharpness of the move down till low probability lows at 8,000. Well! we could not see that, but at least we were not long.

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WAVES.GOLD is a perspective product published on Monday and Wednesday. The report highlights GOLD and other precious and base metals. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

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Author: Mukul PAL | Date: 15 October 2008 | Comments (0)

Tags: gold

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MOVING SUB 100, PREPARING FOR 300

A recent conversation with an old friend on 11 July, went like this.

MP: How are things at your end? You ready to retire after making your billion? RL: Well I have not yet reached the billion dollar value, still struggling to hit that number and then quit.  Meanwhile oil has hijacked the gains so retirement has become doubtful.

The timing of this conversation was perfect. 30 Jun OIL hit  dollar 150 and 11 July it was still retesting the previous highs. Now prices have fallen till 112. Blaming Oil was easy. But whom will we blame when it moves to dollar 300. These high targets did not seem improbable at dollar 150 and will look incredulous sub 100, but then sentiment extremes are not always easy to visualize.

The right form of OIL illustrated on the right suggests a completed 3 circle primary wave to us with 4 and 5 primary circle still to come. This means we are indeed heading for a 2015 retirement hijacking. Both Oil and markets give a second chance.

The 3 circle primary took 6 years. It took about a year each for wave 1 and 2 circle primary. This makes it an 8 year bull. From a decade cycle the bull is definitely exhausted. But from the 30 year commodity cycle the energy asset can easily extend till 2012. And if you take cycle translation into view prices could continue to push higher beyond 2015.

What does this mean? This means that after 4 circle primary wave pause, the final up leg higher should begin. This could take oil till dollar 300 and maybe higher.  Now the interesting question is the kind of formation the 4 primary leg would take. The classic extended one, or the sharp down. Elliott Alternation rule is in for a sideways action till Q1-Q2 2009. This could probably keep OIL in the primary log channel illustrated here. But in any case previous 3-4 intermediate supports easily point to a sub 100 target.

The timing for OIL fall could not have been better. Now with all the recession worries here and OIL inspired news on a new high, the commodity decides to surprise. But then that’s what market is all about, surprises. A potential fall till dollar 70 is another preposterous target that could happen sub 100.  Read THE OIL ROCKET published in May 2008 when we said the ROCKET up is unsustainable. Sub 100 would mean a drop of 50% from the historical top. This should be some reason for a red signal for OIL BULLS and green for Equity Bulls (WAVES.GLOBAL).

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Author: Orpheus | Date: 15 August 2008 | Comments (0)

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Nothing can rise exponentially, even if it’s OIL. The asset’s exponential rise is more an indication of an ending trend and not vice versa.

We don’t have any chilly warning about OIL heading to dollar 200, like many in OPEC believe. Does OPEC really know? The axiom linked with 40 dollar plus OIL, as harbinger of recession has been long trashed and now not only we are waiting for recession but also for dollar 200 OIL. It all seems a bit strange to us.

OIL moved up 3 times from the 40 dollar mark and DOW is still at 13,000, just 7% lower than historical top. So either the other best indicator for recession that is S&P500 and DOW Jones have stopped working or econostats have blinded us.

For a start we have some common sense rules, which say rockets come down to earth and satellites remain in the sky. The way OIL is behaving makes it either a rocket potentially getting ready to become a satellite or this all is an illusion. OIL can never become a satellite, no asset can. And the almost ninety degree inclination to new highs is destined to collapse. And what will collapse along with this is the dream of OIL riches.

It’s how you look at it. Bloomberg Markets looked at it as the END of OIL era and a few Wall Street brokers looked at is a great time to solicit mass mailing lists for OIL CALL options. Well we don’t subscribe to the OIL end era yet, but if the best broker suggests buying CALLS with such confidence, we definitely don’t know something he knows or something everybody knows. But that’s good, if we don’t know, what everybody knows. Because if everybody knows something it’s already discounted and the truth is already out there that OIL is TOPPING.

Of course the reason of the fall, when it happens will be like this…”Winters were cold so OIL rose and summers are hotter so OIL is falling”. When OIL falls in winters, which it did from 2000 to 2002 and later in 2006 to 2007, the winters were warm. For us OIL is more than a climate barometer. It’s like all other assets, which are connected with 0.5, 4, 11, 30, and 90 year cycles. And all these time cycles can explain cycles of inflation, deflation, disinflation, food, gold, equity, recurring geopolitical crisis, interest rates and also how we should handle a portfolio within the year. It also tells us about what is going to happen to OIL in 2012. We will be discussing this next time when we talk about asset cycles in 2012.

At this stage what we can see is a sentiment euphoria which is hard to sustain. The five legged fractal structure both starting 1999 till 2008 and the smaller five legged sub structure starting in 2007 seems complete. And holding one’s impulses to ride on this rocket seems reasonable to us. FIB and CHANNEL targets lie at current levels. We don’t see OIL above $ 125 at this stage and our research IMPULSE (we are humans too) shows more of a PUT than a CALL.

What will happen can also be explained with another magical previous 4 rule. Price impulse moves in a five wave structure. And you can label them like a school exercise of counting 1 up, 2 down, 3 up, 4 down and 5 up. Now this exercise can be done on a large (multi year) time frame and a multi day time frame. This is what we keep mentioning as mass psychology fractals impulsing again and again at all degrees. It’s the magic human nature plays with precision.

After every impulse the markets take a pause and fall in three wave structure (a down – b up – c down) and then the impulse starts again in an unending process. That is why we say that world may never come to end, it’s just that some time the volatility of relentless market action becomes too much for a society looking one way. This always happens, like the subprime mess and the credit crisis. We all look up to OIL now and not NAT GAS, which is the next multi year outperformer. We love to see rockets and ride them, other things don’t excite us.

So whenever an impulse (five legs) takes a pause, they fall to the previous 4 wave. This is a much witnessed event in fractals. Previous 4 wave supports are also mentioned as the last supports standing. Prices should not fall below the previous 4 wave or rise above the previous 4, if the trend has to continue. Of course this is a guideline, but this appears more time than coincidence.

You can see this everywhere, BSE OIL, BSECG, BSE BANK, BSEAUTO, SENSEX, NIFTY and CNXIT (Indian Sector Indices). They are all full of previous 4 wave retests. OIL when it turns down could fall to first a previous 4 wave support at dollar 90. And if it indeed breaks that, we can be in for sub dollar 70 levels. And this we are talking about the next few months. We can be wrong. But not like the poor chicken, an anecdote quoted by the late A J Frost, Market Guru.

The chicken used to run at the presence of the man, but man’s appearance on the scene was linked with corn. This happened 999 times, till the Chicken went to thank the man and had his neck sliced. Though anatomy proves that we are more like sheep and herd, we indeed might be chickens when it comes to cause and event linkage. We are miserable here and believe summers and winters drive the Oil rocket. Indeed a poetic tragedy.

ORPHEUS GLOBAL RESEARCH

WAVES.OIL is a perspective product published once a week. The report covers BRENT, WTM, XLE (Energy SPDR), top energy stocks, Natural Gas and related FUTURES. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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Author: Orpheus | Date: 10 May 2008 | Comments (0)

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THE STORY OF HOW GOLD FOOLED RECESSION. DID IT?

We are not in times of mess. We are in times of unprecedented mess. Not because people have lost lot of money, but because loss is messy, loss of jobs, loss of a house, loss of a client, loss of purchasing parity, loss of belief and confidence. We also lost benchmarks about what market acumen really means. Is it about J P Morgan’s quantitative skills costing taxpayers millions of dollars or about Northern Rock, the smart bank of United Kingdom which went bust? We are just witnessing economics the way Elliott once said, “Laws of economics are as they should be, ruthless”.

And if you think flunking finance will teach us, you are mistaken, the fool’s gold is a mirage which will continue to occur with cyclical precisions, just a few learn, rest perish. Abraham Lincoln said, you can fool some people most of the time, all the people some time, but you cannot fool all the people all the time. Markets will thrive till it can fool all the people some time. Markets have to live you see, so it will keep fooling a few of us all the time. We at Orpheus know that the challenge is to be fooled less, as it’s the human destiny to be fooled sometime, as you can not fool the market anytime.

What Gold is doing now, seems another mirage that could surprise us in the short term, say more than a few months. A few weeks are enough for markets to destroy 80% of wealth. It took three years to destroy 70 years of wealth creation from 1857-1929. But what we are talking here is about Recession. How Gold’s rise is connected to destruction of paper money and everything non tangible, be it stocks or CDO’s and swap options. Gold’s rise and dollar’s fall started taking a universal truth status. And when a thought reaches epic proportions on mass psychology, market twists the axiom. So if Gold is going up because of a crisis, a fall here on Gold should end the same crisis. No?

The Gold-Silver ratio, we highlighted last time (The Metals Maze) gave no signal of a collapse. Rather the sentiment indicator has moved unfazed despite millions going homeless and more than 100,000 losing their financial jobs (more serious than the tech bust). This means two things, one that the Gold-Silver ratio has stopped working after predicting the 1980s and 2000s crash or second the crisis has not yet started. So if the crisis has not started, we might have a respite coming before the real mess starts. We at Orpheus at this stage don’t know what real crisis the indicator is suggesting, but it definitely seems more than just linked to Gold and dollar.

We kept track on Gold, publishing short term updates. However, it’s been exactly a year since we published an exhaustive Elliott counts on GOLD. WAVES.GOLD published on gold on April 21 2007 made a few projections. One of them was that above dollar 690, its 1000. We have juxtaposed the cases from the old report with the new ones before making projections ahead in time. We have also updated the channeling system, which we explained last time when we talked about CHANNEL psychology when we talked about Jesse Livermore.

‘Anticipated’ and ‘Happened’ cases have stopped surprising us and fractal watching is slowly and surely increasing. Somebody asked us at a recent conference on Elliott Waves. What if Elliott and fractal watching becomes popular. Will it stop working? Well on the upfront this gave us some joy, as the question regarding Elliott’s wave performance assumed that it worked. About the other part, whether it will stop working, the answer was simple. We humans are so focused on short termism than long term asset watch, long term investments are left to gurus like WARREN BUFFET. Well Buffet went over 3 decades, but the long termism we are talking about is more than a few months, maybe more than a year. Wars and battles for profits are short term in nature that is why even if the number of Elliotticians increases globally, it’s only the short term counts that may get more chaotic and confusing. On the longer term there are always opportunities few look at.

Coming back to Gold, now that prices have hit the anticipated targets, we are on another alert now. Is it over for the Gold rush for a few weeks, or is Gold ready to fall for a few months, till where? And if it’s indeed over that’s bad time for Recession watchers. Falling Gold prices mean, dollar strengthening and dollar strengthening means new high on DOW. This might confound many and common sense might catch up finally that if US markets are rising why BRAZIL, RUSSIA, INDIA, CHINA and ROMANIA should keep falling.

According to the TIME and PRICE symmetry, it seems Gold has topped and is ready to come down back to dollar 800 levels and potentially lower sub 800. The funny part is that if we indeed are on the smart side, new highs on DOW will have new excitement linked with it, new patriots, new bloggers, new fool’s looking for the new gold.

Enjoy the latest WAVES.GOLD

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WAVES.GOLD is a perspective product published on Monday and Wednesday. The report highlights GOLD and other precious and base metals. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

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Author: Mukul PAL | Date: 21 April 2008 | Comments (0)

Tags: gold

Categories: Forecasts

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If there is something that can take oil up or down, it’s the geopolitical risk. Is it? The top news now says that, “Crude oil may fall next week after Iran’s release of 15 British naval personnel eased concern that shipments from the Persian Gulf will be disrupted; 48 per cent of oil analysts said oil prices will decline, 25 per cent said prices will increase and the rest said they will be unchanged.” This means that if geopolitical risk is the biggest driver for oil then there are more reasons why the asset should fall. Well we have proved this time and again, how weather, Iran or geopolitical risk cannot really predict (accurately and consistently) where prices will go tomorrow, next week, next month or next year. We can try explaining this again.

On March 12, around 10 days before the incident, this column said, “Though we maintain our bullish view on oil, timing the purchase is what matters most. We still need more confirmation to consider the oil fall from August 2006 to January 2007 as the end of the oil bear move. We would give the commodity till the end of March to tell us if it’s done with falling.” Oil has clearly moved above a key 50-day moving average. The last time this happened was in July 2003. Oil was above this nondescript rolling line till July 2006.

This means two things, either the geopolitical risk continued to increase over the last four years, the very reason prices never actually fell, or the rolling line understands oil more then analysts do. A simple ‘Buy’ in July 2003 with a month long confirmation would have kept us away from all noise. Current prices have made a clear attempt to move above the rolling average. And it seems that apart from all the news, a support here above the average might be all that we need to take oil from 60 to 100. And as we mentioned last time, the energy asset has a four-year cycle, which bottomed out in 2006. The next cycle should move on till 2010. Our Preferred count still looks up and considers the break on 50 day moving average, momentum confirmation, log channel support (Slide 2), oil cyclicality and intermarket conformation from S&P Energy Index, as positive signs. However, on the Alternate count the bottom formation still seems to be wanting. First the fall from the top has not completed 9 months, which makes the current move intermediate and not of primary degree. This means the 4 primary (A)-(B)-(C) might continue for some time before oil actually bottoms. Second, we have the WTM (Midland), which unlike Brent has not closed above the 50 period moving average. WTM still is below key levels to call it over.

While we might still need more confirmation on oil to rule out the alternate count completely, natural gas is ready to move up. Our Nat Gas target remains above 20 for the asset. We have detailed other related Indices and ETC’s to validate our case. Energy remains poised at a significant juncture. How geopolitical situations predict oil is a tough call, but reading interpretations should be definitely interesting weekend reading.
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WAVES.OIL is a perspective product published once a week. The report covers BRENT, WTM, XLE (Energy SPDR), top energy stocks, Natural Gas and related FUTURES. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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Author: Orpheus | Date: 09 April 2007 | Comments (0)

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Daniel Kahneman, Father of behavioral finance has clearly illustrated in his life long and Nobel Prize winning work that a majority of us humans are loss averse. Even if it means making a wrong choice. If we plug his work on the Elliott fractal then we can assume that all down ending C waves will have very few people digging into stock fishing. There will be more panic, as extreme negativity involving mass psychology would mean “stay away”. Capital conservation is not a strategy for a top, it’s always been an investment strategy for the bottom. This is why Humphrey Neil said, masses generally go wrong on a turn. But as technicians, we understand that timing is the name of the game.

The prosperity index espouses the same principle of wrong choices at an extreme. We highlighted the prosperity index on 13 Nov 06 in our WAVES.METALS report. Also known as the Gold-Silver ratio, the ratio lows come near prosperity highs. As illustrated, we as a society are heading into the most prosper times of the last 25 years. And conventional wisdom and conventional research foresees prosperity as a straight line, which means the bounty and loot shoot continue. But unfortunately, life and everything in nature, like stock market is cyclical. After high prosperity it’s time for the swing to the other extreme. The ratio is near 1 and has always returned back from these levels for a quarter century. Whether the Index will turn again remains to be seen.

On the short term, the anticipated triangle resistances ahead for Gold, Silver, MCX – Gold Near, HUI – Gold Bugs, NEM Newmont Mining Corp, GFI Gold Fields Limited and XAU – Gold and Silver Index are still running at 640, 13.2, 9300, 340, 47.4, 18 and 144 respectively came in visibly and clearly. A break for Gold here will push us to our alternate interpretation of a Gold flat up to 690 and maybe to a new high with a first target to psychological 700. If prices move above 690, we will get two signals. One it’s time for Gold (tangible asset) to move to 1000 and second that the prosperity Index has turned from an extreme and it’s time to conserve capital in the paper assets (non tangible) that you might be holding.

Author: Mukul PAL | Date: 24 January 2007 | Comments (0)

Tags: gold

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After the confusion at 60, we threw in the towel for the alternate count looking at prices lower than 17 Nov low. This was still easy, as Nov – Dec move up was a counter trend move, which had to end and push prices lower. Now we are almost $ 10 down from 60.

Last few months we have been mentioning of a little something which OIL had left behind when it moved up in Dec 06. It was the test of psychological 50, which was not just a psychological level but also a confluence of many price objectives. We mentioned two degree of price objectives. First kind justified an upmove near 54-55 viz double top (slide 5), multi year supports and resistance reversal points, moving average penetration and retest (slide 3).

The second degree price objectives were the little something that OIL left behind. The second degree price objectives were the previous 4 wave (slide2), normal scale channels with price objectives as the width of the channel and the log scale channel (illustrated – slide 4 and 5).

Now OIL has achieved the second degree price objectives and also some FIB objectives with C=0.618*A for the ZIG ZAG internal ratio. What happens beyond current levels, is nothing short of falling over the edge for OIL. We at Or-phe-us are ENERGY BULLS and remain long term positive on OIL with future targets above $100. A clear break here does put us back on work to chalk out the counts again. At this stage we see psychological 50 and short term support come in. Beyond 50 we will have to review. We have enclosed support zones and a historical check on what we anticipated and how prices panned out.

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WAVES.OIL is a perspective product published once a week. The report covers BRENT, WTM, XLE (Energy SPDR), top energy stocks, Natural Gas and related FUTURES. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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Author: Orpheus | Date: 10 January 2007 | Comments (0)

Categories: Energy

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These are the famous words of Geologist Kenneth Deffeyes voiced in FEB 2006. Though the expert reiterated later saying that the words he said were a bit harsh, the quote anyway found its way to the top list of 2007 quotes. Books and cover stories highlight a mass psychology extreme. We call it a cover story indicator. Economist came up with a cover story on Dollar doldrums four times since 2004. Every time the cover page story hit the stands, dollar strengthened by 10-15%. Such inverse behavior of markets unlike what a reputed respected magazine suggests highlights how mass psychology works. If more than a million readers of Economist know that dollar is going down, most likely we will have a surprise, as a million people can not make a killing together speculating on the dollar. Same way, if the OIL expert writes a book about OIL crisis, most probably we are near an intermediate top. This is what happened, as OIL is much below the top and now other experts pen out stories about OIL.

Oil prices rest near $ 60 now. The analysts still sight continuing warm winter expectations and delayed deliveries. But how can delayed delivery push prices down? If OIL does not reach you in time, the demand should increase and take prices up. Maybe delayed delivery leads to inventory build up, which pushes prices down. This was for ‘OIL Bears’. The analysts have even conjured up new year forecasts for ‘OIL bulls’. They want to keep everybody happy. Despite warm winters, fog and delayed deliveries, OPEC is trying to reduce output to stabilize the market. Overall the outlook for the year ahead is mixed.

We at OR-PHE-US believe mixed analysis is easy analysis. If markets are moving sideways for the last one month, it’s easy to sight neutral reasons why OIL could go up and why OIL could go down and in conclusion how buying pressures match selling pressures to keep OIL where it is now, sideways. We sighted an extremity of OIL at $78. Now we see another consolidation zone, concluding in another leg up. The very fact that warm winter talk is ubiquitous is the very reason, it may fail to work. We still believe OIL remains in an OIL primary trend down to sideways, but short and intermediate term suggests a move up in Jan 07 before any real dip happens.

We gave MCX OIL buy near 2700 levels. MCX OIL moved up to 2900. Technically speaking the retracement up still looks wanting and shallow. Our target level still stands firm near 3000 levels. We will make an early review next year, if international OIL prices stay below $60. Any by the way, we partially agree with Deffeyes about a crisis, though we are not sure of the stone age. And even if we do hit stone age, we see it as a life time buy opportunity.

Have a prosperous New year.
ORPHEUS GLOBAL RESEARCH

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Author: Orpheus | Date: 29 December 2006 | Comments (0)

Categories: Energy

We recommend: The Orpheus Virtual Store | The Orpheus Research at Reuters: UK, USA