-GCRU- Weekly Trading Service THE GAME OF MUSICAL CHAIRS. Achieves gains by trading commodities, currencies and stocks

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1 -GCRU- Weekly Trading Service Achieves gains by trading commodities, currencies and stocks Omar Ayales NNOVEMBER 1, 2017 IN ITS 16 th YEAR Nº 761 THE GAME OF MUSICAL CHAIRS The rising dollar and the 10-year yield spooked the gold price, but it was gold shares that were hit the most this week. We picked up some DUST as a hedge against more gold shares weakness, and it looks like it has further to go. And while gold shares were hit the hardest, the HUI index continues to hold above both its uptrend since Dec 2016 at 186 as well as its key Mar low support near 180. Both are key levels for HUI. As you ll see in the chart section below, our in-house A/D Line is also bouncing up from the Dec uptrend showing a rising support. to a 6+ month high. Brent crude rose stronger reaching a two year high! Crude is pennies away from our profit target at $55. We ve done great trading oil this year. It has allowed us to profit at almost every turn. And now, even though it's showing more upside potential, we recommend selling into strength and closing out the rest of your position for a 23% gain. We ve reduced our exposure to gold shares by protecting built in profits in BTG and WPM over the past weeks. We also reduced our exposure to silver earlier. We continue to hold full positions in AEM and GDXJ. But most impressive has been crude. A decline in inventories likely due to increased global demand and speculation of supply disruption, as mentioned last week, pushed it The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty - Winston Churchill - 1

2 Keep in mind we re still exposed to crude through XLE. We actually picked up some more during this week s lows near $67. Interestingly, XLE has not risen as strong as crude yet and has strong resistance at $69. But if crude lives up to its potential, XLE is poised to catch up. The relationship between XLE and crude is our chart of the week. The chart shows both crude and XLE indexed to 100 since last December. Notice how much stronger crude has been compared to XLE since its June low. The gap between both has been widening exponentially showing how much stronger oil has been than energy shares since the Summer. This gap will narrow, and if XLE breaks above $69, it ll be off to the races! XLE should then catch up to the strong oil price. In the meantime, the dollar bounce-up continues. The developing uptrend and the dollar s leading indicators continue to show room for more upside. Our call spread is gaining value quickly. It s in the money. But remember, it can also lose value quickly as time goes by. Our spread has 37 days until expiration and we ll be looking to sell this week. It s up 120% since we bought it. You can decide to protect built profits today or let it run a bit further. All market eyes are on the Fed this week. By tomorrow we should all know who will be the new chief of the Federal Reserve. If Jerome Powell is chosen to head the central bank, we'll see pressure on the dollar and the yields, which in turn is good for gold. Yields are already hinting toward a Powell nomination. Although the yield on the 10- year T-note broke above ST resistance at 2.42%, it continues to resist. It s struggling to stay above that key level. But that shouldn t come to as a surprise, particularly when European junk bond yields are now lower than the 10YY! Our chart below shows the euro, the dollar and the 10-year yield over the past year. Here you can see the clear mirror image in the dollar index and the euro, and how closely the 10-year yield moves with the dollar. The three clearly broke their 15-week MAs showing the contra-trend is underway. Keep in mind, they could retest their 15-week MAs, and still be in a contra-trend. The 15-week MAs identify the medium term trend, and this upward correction in the dollar index and the 10YY will remain in process as long as they hold above this MA. Likewise, for the euro; it will remain in a downward correction below this MA. They all have ST "wiggle room" and stay the course. Resources took a step back. Copper declined from the highs but continues to hold above its bullish uptrend near $3. Copper is poised for more upside. We continue to hold half of our original position and have a buy 2

3 order in case the bullish uptrend near $3 is tested. FCX is showing volatility near the highs. It s struggling with the $15.50 resistance. However, FCX is the poster child for copper shares and should continue to rise as copper s bull market develops further. Keep your position. The stock market continues to rise with strength. Solid earnings continued to push stocks higher. We continue to wait for a pull back to buy back. Stocks have not conceded thus far. I think the correction is coming. It s a game of musical chairs. Someone will be caught when the music stops. We ve protected profits and have cash on the sidelines, patiently waiting for a correction or dip to buy once again. We continue to wait for our song Our strategy this week is to take profits on crude. Also look to sell your dollar bull call spread or at least have an exit strategy for the following week or two. Pay attention to the Fed chair designation. It could rattle the markets one way or another. Regardless, keep your eyes on the trends. They truly are a trader s best friend! Good luck and good trading, Omar Ayales Chief Trading Strategist GCRU A division of Aden Research 3

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6 CHARTS Long Stop Profit Targets Recom GOLD DECEMBER 2017 (GCZ17) 10/31/2017 CLOSE = DESCENDING TRIANGLE EXPOSING PATH APR DOUBLE 'A' PEAK MAY MAR KEY TRIPLE BOTTOM SUPPORT SPINNER (3, 16, 16) JUN JUL B M A M J J A S O 1170 (Jan-5-17), 1220 (Mar-16-17). Sold half at 1287 for an average 8% gain (Jul-3-17). Long: 2dc below 1230 Stops 2dc below & Profit Targets & 12 Keep your positions. Buy more below Sell half at first profit target. C MOMENTUM DECLINING OCT Recom SPROTT PHYSICAL GOLD TRUST (PHYS) 10/31/2017 CLOSE = (Jan-5-17), (Mar-16-17). Sold half at for an average gain of 7% (Jul-3-17). Keep your positions. Buy more below Sell half at first profit target. Gold continues to trade within a narrowing bearish descending triangle. It has support above the Oct lows, but has stronger resistance below the Sept downtrend near The bearish descending triangle tells us more downside is probable if gold breaks below Interestingly, gold has strong support at 1255, its 23-mo MA and near 1235, the Dec 2015 uptrend and cyclical bull market support. As long as gold stays above these levels, it'll remain positioned for more upside. Spinner sunk below zero, showing weakness. It's also showing the downside may be limited to one of the levels mentioned above (1255 or 1235). The thing is deep rooted fundamentals continue to back up gold. The charts on a longer-term basis, particularly since Dec 2015, do too! We recommend keeping your position and buying more during weakness. JUN TESTING SUPPORT SPINNER (3, 16, 16) JUL SEPT J J A S O OCT WEAK BELOW ZERO

7 SILVER DECEMBER 2017 (SIZ17) 10/31/2017 CLOSE= NOV HOLDING ABOVE APR SPROTT PHYSICAL SILVER TRUST (PSLV) 10/31/2017 CLOSE= 6.27 JUN SEPT DEC JUL SPINNER (3, 16, 16) DOWN SPINNER (3, 16, 16) N D J F M A M J J A S O JUL AT BOTTOM SIDE OF TRIANGLE... NEAR GREEN SUPPORT M J J A S O Long (Mar-16-17), 17 (May-1-17), (May-4-17), 17 (Jun-12-17), (Jun-26-17), (Jul-3-17), (Jul-13-17). Sold half at for a small gain. Long 6.60 (Mar-16-17), 6.40 (May-1-17), 6.20 (May-4-17), 6.55 (Jun-11-17), 6.23 (Jun-21-17), 6.15 (Jul-3-17), 6.03 (Jul-13-17). Sold half at 6.27 for a small gain. Stop 2dc below 16. Stop 2dc below 6. Profit Targets Recom 21 Keep your positions. Buy more near 16. Sell half at first profit target. Profit Targets Recom 8 Keep your positions. Buy more near Sell half at first profit target. Downside pressure continues to take a toll on silver, albeit at a lesser pace than gold shares. Resources have been pulling back, but silver still has to catch up to them. Silver will remain with an upside bias as long as it holds above A break below this level would show ST weakness but must break below the Dec lows on a 2dc below 16 to turn bearish. Silver shares are also holding up, which is a good sign that silver is near its low for the move. Keep your positions. 7

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9 MKT VECTORS JR. GOLD MINERS (GDXJ) 10/31/2017 CLOSE= FEB APPROACHING DEC UPTREND THE LONGER TERM SUPPORT SEPT DEC SPINNER (3, 16, 16) MAY NEUTRAL D J F M A M J J A S O Junior Gold Miners ETF (GDXJ) - NYSEArca Long at: Stop: Profit target: Recom: (Mar-16-17), (Apr-17-17), (Apr-25-17), (May-4-17), (Jul-10-17). 2 dc below (adj). Keep your positions. The Juniors continue to hold above the Dec uptrend despite recent weakness. Spinner broke below zero but it s quickly turning around, testing the zero line once again. If GDXJ continues to hold above the Dec uptrend at 31, it s a matter of time until GDXJ turns up. Keep an eye on the Sept downtrend near A break above this level would be the first clear confirmation of strength. Surpassing the Feb downtrend on a 2dc above 36 will be the stronger hurdle to overcome. Keep your positions for now and as long as GDXJ stays above

10 Agnico Eagle Mines Limited (AEM) 10/31/2017 CLOSE= FEB SEPT 50 OCT 45 JUL MAR VULNERABLE ST... YET HOLDING ABOVE JUL LOWS 40 DEC SPINNER (3, 16, 16) STILL A BOTTOMING LOOK D J F M A M J J A S O Agnico Eagle Mines Limited (AEM) -NYSEArca Long: Stop: Profit Target: New Recom: (Mar-16-17). Sold half at for an 8% gain (Jun-29-17), 44 (Jul-13-17). 2dc below & 60 Keep your positions. AEM continues to unwind. In the meantime, it s fighting to stay above the Jul lows, thereby hinting its floor has risen. Notice Spinner continues to rise longer term showing momentum keeps building. This tells us AEM is poised to continue rising if and whenit breaks above the Sept downtrend on a 2dc above Keep your positions for nowas AEM continues to offer some of the best potential out there. 10

11 Wheaton Precious Metals Corp Co (WPM) 10/31/2017 CLOSE= FEB BREAKING FEB DOWNTREND SEPT MAR AUG SEPT DEC SPINNER (3, 16, 16) UPTRENDING D J F M A M J J A S O Wheaton Precious Metals (WPM) (Mar-17-17). Sold half at for a 9% gain Long at: (May-4-17), (Jun-14-17), 19 (Jun-15-17), (Aug-23-17). Sold half at for an average 8% gain. Stop: Profit Target 2dc below (adj). 2 New Recom: Keep the rest of your position. WPM is holding up strong. It's holding above an uptrend since Sept, after breaking the Feb downtrend last week. Spinner continues to uptrend quietly as momentum builds. The level remains WPM's key support, but if the Sept uptrend is broken, it'll signal that this key support could be tested once again. We took partial profits last week and we're keeping the rest. Update your profit targets by leaving a single one at the top side of the Dec upchannel near

12 B2Gold Corp. (BTG) 10/31/2017 CLOSE= JUN MAY SPINNER (3, 16, 16) AUG BOUNCING UP FROM MAY UPTREND RISING FROM EXTREME LOWS, LOOKING GOOD! M J J A S O B2Gold Corp. (BTG) -NYSE MKT 0.25 Long at: Stop: Profit target: 2.45 (May-25-17). Sold half at 2.82 for a 15% gain! 2dc below New Recom: Keep the second half of your position. Buy some at mkt, near BTG bounced up from the May uptrend near 2.45 as Spinner rises from an extreme, breaking above its MT MA. This tells us the May uptrend for BTG is a low area. As long as BTG stays above this level, we could see it rise higher. Conversely, a clean break below the May uptrend could push BTG lower, to possibly the May lows. We recommend picking up some at mkt at these lower levels. 12

13 U.S. DOLLAR INDEX DECEMBER 2017 (DXZ17) 10/31/2017 CLOSE= DEC SPINNER (3, 16, 16) MAR BREAKOUT! NECKLINE SEPT TESTING RESISTANCE (BROKEN GREEN LINE) N D J F M A M J J A S O Bull Call Spread Dec 2017 $350 (Sept-13-17). 1.5 Recom Keep your positions. Sell the bull call spread near 95. The U.S. dollar index broke above a bullish reverse H&S with upside target at 96. The target coincides with a strong resistance at the dollar's primary trend: the Dec downtrend. Notice Spinner on the rise, testing resistance. This tells us the dollar is positioned to rise to test the Dec downtrend. A break above this level on a 2dc above could see a quick rise to However, if the dollar resists below these levels, the bear will continue pushing the dollar lower. The time to sell your bull call spread is approaching. It's currently up 120%!... Sell at mkt to protect profit or keep for a week or so before selling. Don t wait too long as time will eat away its value. 13

14 CBOE Interest Rate 10 Year T No (^TNX) 10/31/2017 CLOSE= 2.38 DEC MAR BROKE RESISTANCE AT 2.42% BUT... OCT MAY JUL SPINNER (3, 16, 16) JUN SEPT BULLISH ABOVE ZERO BUT RESISTING D J F M A M J J A S O 0.1 CBOE Interest Rate 10 Year T No (^TNX) - Chicago The 10YY broke above a key ST resistance level at 2.42% reaching highs last seen in Mar. Spinner stayed on a bullish course but has reached a high area showing limited upside ST. If the 10YY now stays above 2.35%, the Sept uptrend, it could continue rising. A break below this level, however, could signal the end of the up move since Sept and start a renewed decline. Interestingly, the U.S. 10YY rose higher than the yield on European Junk bonds! This effectively means the market has priced the U.S. 10-year Treasury note as a riskier asset than European Junk. It's common sense to expect investors to dump their European junk for U.S. 10-year T- notes, which would boost U.S. bonds and put downside pressure on its yield. On the other side, the low junk bond yield could also be showing market complacency as risk averse investors plunge into any asset with a yield. It s a mad world out there. But I would bet my marbles the 10YY will fall before breaking above the "make or break" level at 2.62% at the Mar highs. 14

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18 Energy Select Sector SPDR ETF (XLE) 10/31/2017 CLOSE= MAY BOUNCING UP FROM ST SUPPORT OCT 69 JUL PREVIOUS JUL HIGH IS NOW ST SUPPORT SPINNER (3, 16, 16) AUG TESTING ZERO ON UPSIDE M J J A S O Energy Select Sector SPDR ETF (XLE) Long at: (Oct-4-17), (Oct-25-17). -3 Stop: Profit Target: New Recom: 2dc below 66 (adj). 77 (adj). Keep your positions. XLE still can t get a bid despite crude rising with strength. It did hold above a support level at 67 where it s bouncing up from, while Spinner seemingly turns the corner and tests the zero line in an attempt to turn bullish. Keep in mind, however, XLE's strongest test will be breaking the May/Oct resistance at 69. A break above this level could unleash upside potential, and it ll then be following crude. Keep your positions for now. 18

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22 Quoting GCRU is permitted provided GCRU name, website address & subscription price are given. All charts in GCRU are daily prices. Subscribers can obtain free online chart updates for all gold shares in GCRU via: To view Canadian stks please use CA as prefix (ie, to view Agnico Eagle (Toronto) you must use CA:AEM). Note: U should NOT feel our recommended prices are CAD$ Canadian dollar H&S head & shoulder set in concrete. If mkts suddenly feel hot or cold to U, or LOC line on close dramatic news occurs, U can buy or sell, or stop at LT long term slightly higher or slightly lower prices. It also hinges on MT medium term your experience level. Some people can use our prices as NL neckline guides & know when they can take bigger risks. PF portfolio PO price objective Spinner: Spinner is an in-house momentum indicator Recom recommended (not always shown on charts). Momentum indicators use RH&S reverse head & shoulder the rate of change in price to determine predominant RS relative strength energy flows. Spinner trading signals are generated when ST short term the faster timing line crosses above or below the slower Sym/tri symmetrical triangle confirming line. Upside crosses in the lower range of Tgt target positive territory offer the most reliable signals for longs; downside crosses in the top range of negative territory for shorts. Avoid trading against the timing line, ie, buying/selling if the timing line is in corrective mode (against direction of trade) unless the confirming line is Unch Vol Wk Ystdy C unchanged volume week yesterday close positioning for a new 'confirming cycle'. It's important to always be aware of location, direction & cycling phase of the confirming line. Spinner signals are more effective in trending mkts than in trading ranges where indicators such as Stochastic & Williams %R should be used. NOTE: payments for GCRU services should be made payable to MAP CUSTOMER SERVICE. Gold (& mkts) Charts R Us is published weekly. You may sign up for 3-mos at $300, 6-mos at $585, 9-mos at $855 or 12-mos $1, gcru@goldchartsrus.net - DISCLAIMER - Due to the electronic nature of s, there is a risk that the information contained in this message has been modified. Consequently Gold (& mkts) Charts R Us can accept no responsibility or liability as to the completeness or accuracy of the information. Whilst efforts are made to safeguard messages and attachments, Gold (& mkts) Charts R Us cannot guarantee that messages or attachments are virus free, do not contain malicious code or are compatible with your electronic systems and does not accept liability in respect of viruses, malicious code or any related problems that you may experience. Information in Gold (& mkts) Charts R Us is for general information only & is not intended to be relied upon by individual readers in making specific investment decisions. Appropriate independent advice should be obtained before making any such decisions. Gold (& mkts) Charts R Us do not guarantee or assure that readers will make money, or accept liability for any loss suffered by readers as a result of any such decision. Futures and share trading involves risk and is not for all investors. Past performance is NOT indicative of future results. Trading involves risk and should be pursued with risk capital only! 1dc 2dc bot ABBREVIATIONS 1-day close (the share price must close above or below the indicated price level, before our recommendation is activated) 2-day close (consecutive) bought 22