Fortuna is an example in point. % waves may be complete, but then they may not be. If the sequence is complete we are looking at a B-wave that makes the stock double-top about where it is now. However is a simple 5th wave is in progress we could go all the way to the upper trend-line. Between those two is a triangle ( in blue) or a wedge (in red). Other counts may apply but they are not readily visible so , probable do not exist. Ergo if you short this now, or stay short, chances are 10 to 1 that the stock will trade back at least to $4.5 (triangle and wedge) or $3.5 (wave 3 of 3?) or even $3 (62%). In the end much lower levels may apply given enough time. In short you are almost guaranteed a return of at least 30% even if you are wrong by being too early.
FVI
Fortuna has spent the better part of this year rotating around, roughly $5.50. This behavior could indicate that a triangle formed, either from the beginning of the year (purple) or from April. I prefer the latter as the thrust would still fit inside the established channel. The target would be a little under $8 at around the time of the apex (about 2 months from now). An alternative that is perhaps the best count is that there are no triangles whatsoever and that the stock is forming a wave to or B just under the level of the previous top. This fits best with the action of gold itself and that of the Swiss Franc that was down by a hefty 8.5% today, an unheard of large move. Whatever the count this stock should trade at $4/$3.50 in the very near future, perhaps lower. A sell.
FVI
Fortuna seems to be making a triangle, but it could just as easily be a B wave as it is not clearly in a wave 4 position. We will keep an eye on it.
FVI
This stock has not crashed (yet?), in fact it stayed pretty well level for 6 months or so. This one is like a micro cosmos of the TSE itself. Depending on how you count the thing, we could continue up, or drop like a rock. Typically where you have an irregular b-wave (in blue), the subsequent C-wave drops below the start of the A-leg. This has not happened and may hint at a bullish resolution. On the other hand the drop from the actual top is a, relatively clear 5-wave affaire followed by an equally clear correction. This would favor the downside. The big picture, see previous blogs, also favor the downside.
FVI
Got this one wrong the first time, thought it was a sell at the red arrow. In the meantime it has added 2 waves and now one can count 9 in total which may, once again herald the end of the sequence. See also the charts for FR , First Majestic and the Hor Betapro 2X ETF;
FR also has this 9 wave sequence, numbered as the normal 5-waves bull market. It too may be complete or close to that. HZU is a little new to the plate but may actually be contributing to this momentum action. It is nearly vertical as we approach the Hunt brothers $55 peak back in the early eighties. We may not reach that level.
FR, FVI, HZU
So it was not a b-wave but a 5th of 5. In the end the result is the same. When all is said and done this stock should be at about $2.
FVI
This stock is fascinating in so much that it lost 1/4 of its value right on target, but then it came right back and actually exceeded its previous high of about $4.75. This, I think, is an irregular b-wave; irregular in that it went a little higher but is still classified as part of a bearish structure. The wedge leading the stock into its top has a truncated (5) wave within the wedge which, combined with the irregular b-wave promises a fairly violent downturn from here.Notice that both the RSI and MACD are turning down for quite some time now.
Silver itself is also displaying some clear signs of fatigue, this at a level that is rather precisely 61.8% of the highs ($55) during the Hunt brothers failed market cornering operation back in 1981.See chart of SLV below;
FVI
Both these large cap. gold stocks developed rising wedges/flags, pennants, contracting triangles in EW speak or whatever you want to call it. More often than not these structures are erased in their entirety.Roughly that would take ABX down to $36 and G to $35. That is not all of it as, depending on how we get there, 3-waves as shown in the ABX chart, or 5-waves as in the G chart, these stocks COULD drop a lot further. Notice that on both these stocks the RSI and MACD were ringing the proverbial bell on the floor. Goldcorp rang the bell even louder having failed 5 times to rise measurable above it’s previous peak.
Small gold stocks have not done much better recently, see for instance ZJG which is a sort of small cap.index. Recently, November last year, right at the top, we pointed to FVI for the simple reason that it is called Fortuna and all though we do not speak Spanish ,we suspect that it translates , more or less as fortune. Of course it does not say which one – the one you are going to make or the one you are going to lose. Here is the (short-term) chart;
We are trying to keep an open mind with regard to the count. The one used above is by no means the only one possible so we concede that it,and the conclusions drawn from it, may be dead wrong. On the other hand there are a few good reasons to assume it might be correct. For one thing , the upper-trend line is respected perfectly by each and every high in the stock, of which there are five or six. Also the 5th wave, which is the extended one, is pretty close to being equal to waves 1 to 3 combined, again a common occurrence, especially where commodities and/or commodity based stocks are concerned. Furthermore the RSI and MACD started rolling over about half a year ago. If correct $2,50/ $2,00 are consistent with this count, which if you own it from the highs would mean the loss of , at least, half your fortune.
ABX, FVI, G
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