Some musings on the possibility of a bigger pullback in GDX than
we saw on Thursday. Unlike others here, I am not a seasoned trader,
so don't take what I write as authoritative or tradable. Your
feedback is appreciated, however!
A few things are leading me to think GDX will pull back,
possibly this week:
1. gold is parabolic and likely will pull back soon;
2. market momentum is to the down side (short term rallies
notwithstanding), putting pressure on gold mining stocks;
3. on the daily and 60 min GDX charts the 60, 3 slow stochastics
are oversold;
4. there is neg divergence in the MACD on the 60 min chart (but
not on the daily);
5. a bearish rising wedge is evident on the 60 min and daily
charts;
6. the GDX:GLD ratio is close to breaking my uptrend line
(admittedly I only have two touches on my trendline);
7. On Friday GDX broke the resistance line (neckline?) shown on
chart 27 & 28 of the Wednesday Aug 17 newsletter, but it was a
weak breakout, just barely clearing the line then falling back
below it for the remainder of Friday. (The volume was low on the
retreat, however, and there was a late day break of a flag on
increased volume, so we could see higher prices Monday -
Tuesday.)
Posted by frtaylor on 21st of Aug 2011 at 10:11 am
Very interesting, and longer term GDX may be due for a move up.
His charts are monthly, so that's a longer time frame than
what I'm looking at.
Two articles by Cory Mitchell that are less sanguine about
impending vertical moves for GDX:
http://vantagepointtrading.com/archives/4681 and
http://vantagepointtrading.com/archives/4519 GDX usually
leads gold, so the divergence indicates the move in gold is
fear-based and not fundamentals-driven, meaning gold should pull
back rather than GDX exploding up. Note that he was wrong
about when the correction should occur, stating wrongly that it had
already begun back in late July. He should have paid
attention to Matt's wave count!
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GDX: pullback coming?
Posted by frtaylor on 20th of Aug 2011 at 07:36 pm
Some musings on the possibility of a bigger pullback in GDX than we saw on Thursday. Unlike others here, I am not a seasoned trader, so don't take what I write as authoritative or tradable. Your feedback is appreciated, however!
A few things are leading me to think GDX will pull back, possibly this week:
1. gold is parabolic and likely will pull back soon;
2. market momentum is to the down side (short term rallies notwithstanding), putting pressure on gold mining stocks;
3. on the daily and 60 min GDX charts the 60, 3 slow stochastics are oversold;
4. there is neg divergence in the MACD on the 60 min chart (but not on the daily);
5. a bearish rising wedge is evident on the 60 min and daily charts;
6. the GDX:GLD ratio is close to breaking my uptrend line (admittedly I only have two touches on my trendline);
7. On Friday GDX broke the resistance line (neckline?) shown on chart 27 & 28 of the Wednesday Aug 17 newsletter, but it was a weak breakout, just barely clearing the line then falling back below it for the remainder of Friday. (The volume was low on the retreat, however, and there was a late day break of a flag on increased volume, so we could see higher prices Monday - Tuesday.)
On #3, I meant overbought,
Posted by frtaylor on 21st of Aug 2011 at 04:25 pm
On #3, I meant overbought, not oversold.
Decoupling already started with Mining Shares
Posted by FIGO on 21st of Aug 2011 at 08:16 am
Decoupling already started with Mining Shares
On the 31 of july
http://www.jsmineset.com/2011/07/31/jims-mailbox-754/
http://www.jsmineset.com/2011/08/18/mining-share-ratio-to-gold-back-at-pre-qe1-levels/
We should be very near for the Parabolic Moves
Mining Share Ratio To Gold Back At Pre-QE1 Levels
August 18, 2011, at 5:59 pm
Very interesting, and longer term
Posted by frtaylor on 21st of Aug 2011 at 10:11 am
Very interesting, and longer term GDX may be due for a move up. His charts are monthly, so that's a longer time frame than what I'm looking at.
Two articles by Cory Mitchell that are less sanguine about impending vertical moves for GDX: http://vantagepointtrading.com/archives/4681 and
http://vantagepointtrading.com/archives/4519 GDX usually leads gold, so the divergence indicates the move in gold is fear-based and not fundamentals-driven, meaning gold should pull back rather than GDX exploding up. Note that he was wrong about when the correction should occur, stating wrongly that it had already begun back in late July. He should have paid attention to Matt's wave count!