Anyone remember Airedale88 from Raging Bull? He was an amazing Hurst technician, my mentor and my friend. He often stated that gold and the SPX followed the same dominant cycle. Other Hurst analysts strongly disagree. However, you can really see the correlation in the 4.5 year low in March of this year. Gold bottomed about 6 days early and has continued to trough a little earlier in it's cycles since then. In addition, the cycles have been much clearer in the troughs than the SPX, with the fiddlin' Fed.
This week gold put in it's 20 week bottom. If the correlation is still there it means that the SPX should soon follow suit. Gold's peak before the trough was right translated (the top was just before the trough), which is bullish. In fact, it was exactly what I was hoping for from the SPX.
However, what's interesting is that it is a week late. This is bearish. If the cycle was still in warp speed bullish mode it would have been early, let alone on time. This hint of the bear may be a tell for the SPX going forward into the fall.
David Hickson of Sentient Trader believes that the SPX 20 week low was early, on July 31 (very bullish). I am not so sure I agree and if it troughs next week, it will also be a week late.
We will know next week.
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