Updated May 17, 2005
 

For a detailed explanation of the Gold/HUI charts below see article
Gold/HUI Divorce ? April 30
 

May 17 : Gold nearing a bottom ?

Gold's recent weakness was due to a stronger dollar. The dollar's further upward potential  seems  limited  since it approaches an overbought condition rapidly.

Gold six months chart : Formation of new wedge ?
 

Support at $419. $419 is the 61% FIB retracement level from the $371-$456 move. The $419 support hold well on May 17, see little intraday chart below :

Gold Intraday May 17

Gold three year chart :
 

Three year dollar chart :

current counter trend rally may be near its end.
 

HUI six months chart :

Downside potential seems  limited since the Gold shares are approaching a severe oversold condition again.
 

Gold/HUI ratio two year chart :

Gold/HUI ratio suggests a bottom in Gold stocks.

 

Gold/HUI ratio 6 months chart:

The previous Gold/HUI top of 2.47 on April 28 is being challenged. However, still the same can be said today as being said on April 29. Extreme undervaluation of gold stocks related to gold don't persist for a long period of time.

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