The first point I would like to make is that many of you are probably wondering how I could reverse my long term bearish view on the precious metals complex to a bullish view in such a short period of time. The other point I’ve been trying to make is to get you positioned and sit tight, as this new bull market is just getting started. Understanding the Chartology of this sector from the many different precious metals stock indexes, to individual PM stocks and especially the combo ratio charts, paints a picture that if one keeps an open mind and truly understands what is taking place right now, getting positioned and sitting tight makes alot of sense. This is easier said than done of course.
Many are surprised by the magnitude of this bull market rally in the precious metals complex and are trying to come up with all kinds of reasons why it should or shouldn’t be taking place right now, based on whatever trading discipline they’re using. Most are looking for at least a correction to relieve the overbought conditions before the bull market can make any progress higher. That may very well happen, but I’ve been showing you three very important combo ratio charts which are telling me a different story based on the Chartology and inter market ratios for the PM complex.
I coined the phrase ‘Reverse Symmetry’ years ago when I first picked up on it after looking at literally thousands of charts and studying their price behavior. Once you become aware of this particular piece of Chartology you begin to look for it and will see it all over the place from short term minute charts to long term monthly charts. It’s no big mystery why it works but it can tell you what to look for during certain market conditions. The precious metal complex is giving us a perfect example of reverse symmetry right now.
I’ve been showing you at least three different combo ratio charts for the PM complex which showed the end of the bear market and the beginning of the new bull market. Keep in mind this is unique to Chartology and my interpretation of the Chartology. There are many good trading disciplines out there in which some investors can master and be successful while most will give up the minute it doesn’t work perfect. Sticking with whatever trading discipline you choose, whether it’s cycles, Elliott Wave, Gann, or even watching the COT’s numbers, give yourself the time to fully understand and grasp its principals before you give up on it. For me personally, Chartology is the road I chose to travel and after experimenting with several different trading disciplines I always came back to Chartology.
This post was published at GoldSeek on 1 May 2016.
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