A quick update on the status of the weekly view of HUI and its projected ‘W’ or ‘IHS’ bottom as noted in this week’s letter.
But first, to review the daily situation, HUI made its first close above the resistance at 230 (as noted in an update last week by a daily chart). The next important task is to take out the 50 day moving averages, which are currently 234.55 (EMA) and 241.50 (SMA).
The weekly situation seems to be making a try to bring the ‘W’ bottom into play ahead of the IHS. The ‘W’ scenario would call the June low as the capitulation low with the October low as a retest.
HUI weekly has moved above a short term downtrend line (that’s a minor positive). MACD and TRIX are still indicating a bottoming process. RSI is in an uptrend.
What weekly HUI needs next is a pop above 20 on the now triggered Full Stochastics and for the AROON trend to go zero + (green). Notice how AROON never went positive on the hard summer bounce, but has maintained a grind higher.
The index looks good to bottom (either ‘W’ with a low around 206 or IHS with a theoretical low of 168). The ‘W’ scenario is stepping to the forefront so far this week. STO and AROON would go a long way toward locking and loading the ‘W’ if they go 20+ and 0+ respectively.