[GDXJ] update [HUI] [TRX]

As per this post, the SLV chart is a mess, nearly unreadable.  One would like to directly and immediately correlate metals prices to the prices of the miners but recent charts show this does not always hold.  The miners appear to be quite motive in nature while the metals look like crap warmed over.  Perhaps this is just because metals could be near a significant upward turn and the miners represent positive divergence.  The truth is that I don't know and neither does anyone else. 

Since the metals charts are nearly unreadable, the only thing we have to go by is the miners charts and they look bullish to me.   Keeping in mind that this is a 2nd wave in this model, I would like to see the olive path happen down to the 61.8% fib taking out stops as it goes before turning up sharply.  Alternatively we could just see one more small push to the top orange rail and then one push below per the pink path.  In either case, keep a close, close eye on that down sloping red resistance line.  The market has treated that as almost a knife edge in terms of resistance.  A move above it, especially if it occurs in the form of a gap is a strong buy signal for GDXJ.
 

 Given that wave 2 (or B) of GDXJ has turned out to be a complex month long movement I think it is important to review the fact that the models for miners have been predicting the current action pretty well albeit far from perfect on a daily basis.  For example, here is HUI from November 26th showing a blue path.  Below is the chart in question.

 

Below is the actual.  As  you can see, the blue path seems to have been taken fairly closely.  Now we should be very near - couple days or maybe already in place as of today - from another big move up if this model is to hold.  You certainly can see the sell signal which would be a move below the blue line into the region of the 1st wave.

Zooming in,  several things have now come together that would lead me to call for a near term bottom in HUI very, very soon.  Days not weeks and in fact it might have been today.  We have:

• An obviously corrective pullback from the wave 3 high.  This is good news for M+M longs because the 4th wave HT pattern is supposed to only be the penultimate wave.  This strongly suggests one more wave up into red 5 and if that happens then we have to count everything since the bottom as a single motive wave up.  Motive waves don't come in ones!  There are either two motive waves separated by one correction if the broader structure is a correction OR 3 motive waves with two corrections interspersed if it is motive.  So after 5 up we should see a-b-c back and then 5 more to a much higher high into the end of 2016.
• While this whole notion would be bust if it fell below the blue line, the far more likely scenario here would be to begin moving up strongly in the next couple trading days.
• Today's pullback finished what is needed for the E wave of a 4th wave (or B wave) HT: a corrective move to break down the lower rail.  WC is a correction and it looks like it probably finished today.
• The pullback perfectly closed the small gap you see there. When wave overrun a gap to close it you really can't be sure how much further down they will go but when they just perfectly close the gap like this then your odds of a bottom being in go up significantly.
• The pullback was to the 38.2 fib almost exactly.  While this would be a bit light for GDXJ and certainly for JNUG, it is just what I would expect for 4 of 1 of a new trend for a completely unleveraged established commodity play like the big miners.
•  

First confirmation that the next wave up is happening should be a break out of the top orange rail of the falling wedge.  Then a break back into the HT channel lower rail and then the breakout of the top rail should be the kicker.

The target is HUI 225 by early to mid March.  If you see that in 5 waves then don't hesitate to bail out and let someone who doesn't know how to count EW eat the a-b-c fallback because it will come at least to today's price of 188 and perhaps as low as 177 (which would be the 61.8 fib of 225 projected peak).

If I'm right about this then we should soon see the TRX shorts begin to smell a bear trap and cover.   I'm still holding the TRX I bought at .64 and am disappointed that it has not participated in the recovery felt by the other juniors.  TRX is the weakest of the weak, not in the same category as DRD IMO.  But neither does it appear ready to BK and it is priced as if it will.  If miners make a 5th wave up then everyone else is going to assume that the correction for M+M has legs and they will begin to finally buy up these weak players.  I would treat the as you would a call option.  They might expire worthless but they might double or triple quickly as well.

For everyone else who doesn't want to play these hyper juniors, just use shares like TRX as a canary in the gold mine.  If TRX catches a bid then it is a clear sign the investors believe a larger gold move upward is coming.  They loved it at $7.80 but now they hate it at $.57.