SKI Gold Stock Prediction

presented by Jeffrey Kern, Ph.D.

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July 23rd, 2003

Archived SKI Update
More About This Trade

Gold stocks skyrocketed today (Tuesday) with USERX reaching a new intermediate term high of 5.43 (UP 6% to surpass the prior shorting point high of 5.39). What a move! Today was the execution day of the 35-39 index signal and it often marks a breakout point, but I thought that it was too absurd to suggest that the golds would rise so much in one day, so I refrained from considering that possibility over the past two days. Tomorrow the 92-96 and the 16-20 indices execute. Is it a high or is it a true breakout?

The run pattern is now at the classic 2 Down and 5 Up. Due to today’s rise, it is averaging 2% a day, JUST AS IT SHOULD. It is an important run pattern that usually (75%) marks a high OR a low and a high. When it does not mark a high, man, is it bullish!! Importantly, note that such runs will almost always stop at 5 (today) or 6 days (tomorrow on the 2-signal execution day).

I believe that the gold stocks will fly again tomorrow with USERX surpassing the yearly high of 5.65 (from 2/03) to eventually (in one month) challenge (and probably surpass by 1 penny) the multi-year of 6.54 (from 6/02). Tomorrow’s 16-20 index sell signal should mark a one week high. If you trade by the week, I’d strongly consider selling tomorrow and even shorting for a brief return down into the low 5.40s to high 5.30s (the breakout point).

I was unable to force myself to buy on such a strong up day. My colleague helped to dissuade me from acting on our own buy signal. I therefore plan to buy on the pullback early next week, despite his protestations. I am confident about this short-term scenario and am also confident about the scenario for the next 6 months (reported later). Support for the next 6 trading days comes from the 16-20 index back prices that rise and stay at the prior 5.39 high. If/when the market is higher than tomorrow in 9 trading days after tomorrow, it will have once again broken through the 16-20 sell signal resistance and do the expected “skyrocket” until 21 trading days from today (reread and print out that last important convoluted sentence. I tried to write it several ways).

I calculated my profits for the year based upon my actual results, versus, if I had just bought the triple buy and held as I preached to you readers and then changed. Actual results from the 12/02 buy signal: +24%. Buy and hold: +25%. Amazing: I never have the true answer to whether trading or holding is better, but I actually believe that my strategy of trading at least decreased my risk by reducing the number of days that my money be lost due to market exposure. My total days in the market (long and short) since the 12/02/02 triple-buy-low is 95 out of a total of about 160. But it takes a lot more work than buying and holding, a strategy I plan to employ when I get a true 92-96 index buy signal on the Path.

I really wanted to get the exact low on this move down and to get a true SKI bull market. I remain pissed that this market will remain a trade-based hard-work market for me for the next 6-12 months at least. It’s going to take about a year before the 92-96 bull market buy signal can come and I can just sing/relax on most days for several years. The current move is going to be an intermediate rise that can hang up there until the end of this year before a major fall in 2004. But we’re still not in the bull market that rises to new highs persistently every few months. I say all of the above with greater than usual long-term confidence.





How Did This Trade Work Out?

July '03 to January '04




SKI BUY SIGNAL SKI SELL SIGNAL Jeff Sold SKI Gain/Loss Jeff's Gain/Loss
Major Double Buy

Jul 23 03
$5.43

Jeff Buys More

Jul 30 03
$5.42

Add long, renewed buy

Oct 06 03
$6.43

Sell Signal - MARKS HIGH

Jan 08 04
$8.91


Dec 12 03
$9.29
$3.48 $3.86

On this particular trade, the SKI system accurately predicted a Major High in the Gold Complex. Again, Jeff's Special Alerts were invaluable as he saw the signal coming almost a month in advance and was able to exit with even greater profits.

  » Buy Signal
     Jul 23 003

  » Renewed Buy
     Jul 30 03

  » Alert: Major High
     Dec 04 03

  » Alert: Jeff Sells
     Dec 09 03

  » Sell Signal
     Jan 07 04




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