New critical information, must read if you are an investor in the metals and miners.

I'm sitting here waiting for the big breakout in metals and miners.  Yeah, the metals charts are messy, questionable, but the miners look like they are solid so far.  So I'm just sitting here waiting for breakout and I was reading something about Barrick just reporting a big loss, whacking heads left and right, basically in a panic.   We are talking about #2 here in the world, right behind Goldcorp.  So I decide to look up the the ABX chart and what hits me is shown below.

Instead of having the 4th wave HT of GDX, ABX has a normal three wave a-b-c move into blue 4.  From there it is a fairly solid looking 3rd wave bottom into $10.   That's all good and fine except for one small matter.  That is as clear a w3 as I have ever seen and the subsequent movement has been an a-b-c back to the level of the prior 4th.  Because of this....

...I SMELL A POTENTIAL GOLD BULL TRAP.
 
Now, W3 is my own thing.  No other Elliotician in the world will have a clue what it means because I made it up myself and have been developing it as a potential addendum to the EW principle for many months now.  If that turns out not to be a w3 then I'm going to have to reconsider the whole concept of W3.  A rule that doesn't always work either has exceptions that are well documented or it must be  made much, much less a factor in coming up with wave counts.  In other words, it becomes a guideline and not a rule.  It's OK to have rules with known exceptions.  After all, i before e except after c and also in "ei" as in neighbor and weigh, right?  But right now I don't know of any W3 exception rules and so if it turns out not to be a 3rd then I'm back to the drawing board.

But if I'm right then pretty much everyone else I follow is wrong.  EWI would mos def be wrong.  And Avi's claim that HUI 119 could happen faded many days ago.  I don't know if he has abandoned it yet but several of his trigger points on the high end were smashed by the rally in miners so I know he has to be giving it low priority at this point if he hasn't discarded it completely.


Of course, ABX could have decoupled from the rest of the miners but that seems pretty far fetched.  Bottom line, if the recent low of ABX was w3 and the recent 3 wave move to the prior 4th is 4 then have any of the miners really bottomed yet?


Critical insights to take away from this post:

• ABX is close to breaking out of the 4th wave HT movement it currently is in to a higher high than black 3 but until it does, trust nothing and nobody.  If it breaks out that top red line in the zoom in below (per the black letters and the black predictor line) then W3 is wrong, everyone else is right, and the bull just got set loose.  However, a fall below $12.79 says that the recent peak to $13.20 was the C wave of an expanded flat to finish red 2 W3 is likely right and this is going to get cut nearly in half in the next 5-6 weeks.
•  Maybe it is just lagging the other miners but I think not and would not ignore this as an isolated case.  If this cannot make a higher high than blue c below then go play something else and pick up the pieces of the shattered gold mining industry in 5-6 weeks at a huge discount to today's prices.  We should all be very wary how the 5 wave move up from black 4 could not go even 5-6 cents higher in order to make a new high.  
• Since that high there have been 3 waves down so this could on Monday break out or break down.  The only evidence for breakdown right now is the W3 indicator that this entire post is about.
•  If this goes down to $7 and the whole mining industry follows then Avi is likely right, EWI is likely wrong: this will be THE FREAKING BOTTOM of a massive 2nd wave and the next wave up will be a monster 3rd wave eventually smashing through the old highs of 1900 as the inflation part of supernova pump and dump economy plays out.
• Either that or the whole mining industry goes out of existence.  The big miners are supposed to be able to weather the hard times and if ABX is struggling like this at 1100 and 1200/ozt then they are done for at Prechter's 700/ozt model.
• If team EWI is wrong about gold, are they also wrong about the bearish wave count for the broader market??  Hmmm.  All I know is that only the paranoid survive this game.