HUI-XAU-GOLD-Spekulatius - Das grosse Fressen -

Also hatten die doch recht!

[Blockierte Grafik: http://www.ritterross.de/phpBB2/images/smiles/emotlol_2.gif]

Der war echt trocken! Meine Hochachtung Bognair! [Blockierte Grafik: http://www.ritterross.de/phpBB2/images/smiles/danke.gif]

Allerdings frage ich mich nun grade, was passiert, wenn man einen Call auf Gold hat mit einer Knock-out-Schwelle???? [Blockierte Grafik: http://www.ritterross.de/phpBB2/images/smiles/platt.gif]

..."This HUI outperformance of gold over the past week confirmed the seventh HUI/Gold Ratio buy signal of our gold-stock bull to date.

This latest buy signal is once again highlighting the HUI/Gold Ratio, or HGR, indicator."...

The effortlessness of charting the HGR led to entire trading systems being developed around it, and some of these systems yielded excellent major buy and sell signals for the HUI....

I find myself interested in the HGR again this week for a couple reasons. Some of our subscribers at Zeal use the HGR as their primary trading indicator, so they are excited about the latest buy signal. The HGR is also interesting though as its evolution of effectiveness illustrates the typical lifespan of an indicator. Most trading indicators are not perpetual in their utility, but work best for a finite period of time before fading.

With newfound interest surrounding the HGR's latest buy signal, it is an ideal time to examine both its utility and limitations. In order to grasp the significance of the HGR though, it is important to have a rudimentary foundation in the basic mechanics of ratio analysis.

A ratio is simply one number divided by another. In the case of the HUI/Gold Ratio, naturally it is the daily close of the HUI divided by the daily close of the price of gold. When this ratio, or any ratio, is charted over time it provides an excellent running representation of relative strength and weakness between the two variables.

When a ratio is climbing on a chart, it means the top number is outperforming the bottom number. In the case of a climbing HGR, the HUI is either rising faster than gold like this past week or falling slower than gold in order for the HGR to rise. Conversely when a ratio is falling, it means the bottom number is outperforming the top. For the HGR this happens when gold rises faster than the HUI or far more typically when gold falls slower than the HUI.

Generalizing, usually if this ratio is rising significantly it is during a major HUI upleg, as the HUI gold stocks tend to rise much faster than the gold they mine. If this ratio is falling significantly though, it usually means a major HUI correction is underway. Leverage is a double-edged sword, so gold stocks fall faster than gold in their periodic corrections. If gold falls slower than the HUI it is outperforming the HUI and lowering the ratio.

Like any indicator, the HGR has limitations. I've been well aware of these since I first started following this indicator, and in past essays on the HGR I have said that it is best used only as a secondary confirmation, not as a primary trading signal. Nevertheless, due to its ease of use and seeming clarity a lot of investors and speculators have been using it as a primary. It is crucial they understand its limitations.

Before we delve into these limitations, it is useful to consider the bull-to-date history of HGR buy and sell signals. There have been seven of each since 2001. A buy signal is defined as a ratio resistance breakout, when the HGR establishes an upper resistance line but then breaks above it early on in the next major upleg. A sell signal is defined as the ratio falling under its 50-day moving average.

While this clever HGR trading system sounds complicated in the abstract, it is easy to understand when drawn on this chart. Viewing all the HGR buy and sell signals in context also reveals how much more common they have become in the past year or so. Where HGR buy and sell signals used to be rare, now they are happening with increasing frequency. Each of the seven sets of buy and sell signals are numbered below....

The bottom line is the HUI/Gold Ratio trading system that has been popular, and very effective, in recent years does have limitations. Like every trading system it is built on assumptions that add layers of subjectivity that can never be squeezed out. As such, neither it nor any other indicator should be used in isolation for trading. The best odds for success exist when a multitude of indicators agree on a particular likely path ahead.

Therefore prudent investors and speculators will take a signal from any one system with a grain of salt. If only that system is signaling an entry or exit, it should be carefully investigated before capital is committed. This applies directly to the recent HGR buy signal we saw in mid-August as well. Be careful here.

aus:

September 08, 2006

HUI/Gold Ratio Limitations

by Adam Hamilton

?( :D ?(

@edel,
hast du da irrtümlich mit randgold verglichen?

Ist sehr schwierig zur Zeit. Ich würd auf nichts wetten ganz ohne Charts
Wenn ich mir w.o. anschau, wo in 2 Stunden die ganze erste Seite vollgeschrieben wird, sag ich mir dass spätestens im Dez. da noch etwas ganz gewaltiges auf die Mütze kommt.
Hoffe aber noch auf einen anstieg im Nov.
Jedenfalls bin ich so investiert.
Nämlich volle Pulle. Könnte ein Fehler sein.

Grüße
Tschonko

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