Have you been trading Gold, Silver, or maybe some of the Miners recently? They have been quite volatile lately, with many good traders being stopped out and frustrated. I was recently stopped out last week, when some miners did a false break higher above their 50sma, only to turn down and close below the 50sma again.
That may cause some to wonder, “Is this a trap?” and “Why does this keep happening?” Others outright scream, “Bear market rally is over, down we go and soon! Go short!” Since anything could happen, I wanted to look at some charts.
ABX – Sure this could break down, but its actually sporting a bullish descending wedge, a rising MACD, and isnt it possible that we are just looking at a bottoming process?
NEM – It is struggling for sure, but is it basing out or ready to break down? It actually looks like a base is building with that divergence in the MACD & RSI. This could be building energy for a break above the 50sma.
I am writing because I do hear many people saying to short the miners for a big drop coming. At this point, I look at ABX and NEM and I see the possibility of an upside pop soon. ABX and NEM are major components of GDX, so if you were thinking of going short , I would say to stay away from JDST and DUST until the true direction of the Metals and Miners presents itself clearly.
Consider this: Not all Miners are at recent lows and ready to fall apart. Take a look at the following charts. These had their lows back in July and are currently holding onto gains. Was this reversal just a stop run?
This was yesterday when Gold was down $15
SO I am watching a number of things , including cycles and other clues to shape my view of what may be going on in the precious metals markets. I will also cover more in the premium report Friday morning. Care to join u for a month? Thanks for being here.
~ALEX
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