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HUI: Deja Vu All Over, Again

November 7, 2005

I have spent many hours over the last few years reading posts on the Gold-Eagle Forum. It is a wonderful place where many talented and intelligent individuals post their thoughts about the Precious Metals and Precious Metal stocks. There, many different posters have suggested that technical analysis and charting is more of an art than a science. It seems that where some see chaos, others see beautiful formations coming to life.

Through life we are told of many wise sayings that sometimes seem to be too general in nature to be important. We hear that "history repeats." We hear that "if we want to know where we are going, we must know from where we have come." And, of course, Yogi told us "It's Déjà Vu all over, again!" Every once in a while we find a situation where we can put a group of those sayings together to fit a real-life situation. Today, might be one of those days where we see history repeating and the past becoming the future. For the HUI index, I think it might be "Déjà Vu all over, again!"

(For background to this update you might want to review the potential fractal pattern of the HUI index that we discussed in our original article, linked below.)

Some are suggesting that the current chart pattern of the HUI Index might be a triple top. That may be true, but our earlier fractal suggests that it might be time for the HUI to start a very aggressive move to the upside. Our first chart is of the HUI Index in its current configuration. The chart looks like a triple top, and the technical settings do not look overly encouraging. This is a weekly chart, current through Friday 11-04-05.

HUI CHART- Current

Now let's look at our HUI chart fractal from the late 2001 to early 2002 period. It too looked like a triple top pattern. In fact, all of the technicals looked almost exactly identical to our current chart of the HUI.

HUI CHART- 2001 to 2002

So maybe we can use a bit of fractal history, here, to gain insight into how the current "triple top" looking formation might resolve itself. Will history repeat? Will it be "Déjà Vu all over, again? Hint: It might leave Goldbugs chanting Déjà Vu, Déjà Vu, Déjà Vu! …….because if we repeat what happened in the earlier fractal… EXPLOSION is coming!

HUI CHART-2001 to 2002+

Below, is a longer-term daily chart showing that the HUI might have bottomed at the nexus of 3 support lines. If we break higher, the red channel might contain price as the HUI rises.


So triple top versus liftoff. I'll side with history repeats……..Deja Vu!

Enjoy the ride.

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