The Chart - I've taken the Heiken Ashi of the ratio of HUI/VIX. The rationale for HUI/VIX? "Worry traders" - those who buy gold and those that track the VIX - aren't always the same people, but both are often hedging (or betting on) a market crash - or worse. This chart shows the ratio in the red/green candles and in the background the gray is HUI itself.
The Sell Signal - I drew three horizontal lines where HUI/VIX are common and pulled up the (important - the Heiken Ashi is important here - it makes the divergences easier to read). The signal pattern for a SELL of HUI is a divergence on the HUI/VIX followed by a simultaneous spike in HUI to the top zone while the HUI/VIX moves down to the middle zone. In those cases HUI plunges shortly after. Why? I think of it as "hang time" - the gold believers are the last to give up - the VIX has moved lower and the S&P isn't showing worry anymore. Gold as a worry asset then follows suit because fewer new buyers are converted to owning Gold .
The Buy Signal - Worry assets bottom when no one is worried. Yet worry is cyclical. We are very close (maybe 3 to 6 months out, IMO ) from a worry low, and the chart shows it - we are sitting above the "no one is worried" line, but we aren't there yet, at least according to past patterns on this weekly chart. THAT DOES NOT MEAN HUI HASN'T BOTTOMED. Sorry for the caps, but ratio charts are tricky - we can move firmly down into that bottom zone with HUI trading sideways (consolidation) and VIX dropping. I am actually expecting that very thing to happen and have linked a chart showing why I see VIX lower for 3 more months.