we used to have one member here a few years back who would put like 75% of his whole account into mirco cap junior gold and PM stocks, he said that he had to hold for 50% draw down at times but they always came back and made him money.  I hope he stopped following that practice a couple years ago LOL

As I've said before, the price of gold is below now what most of these companies can mine it out of the ground for, so a lot are going to go (and have gone already) out of business, and many will be bought up, only the strong will survive.  Many mines will be close because it's not profitable to mine the metal.

Eventually supply and demand will catch up and there will not be enough supply thus the price will go back up, then the cycle begins again, but that takes a long time.  

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Now short term technically, as you know gold stocks have under performed greatly with respect to the metal as evident by the GDX/GLD ratio.  To me GDX appears to be in a 5 wave pattern starting from the 27.63 high in Aug and a wave 2 bounce in Aug and wave 4 bounce in Oct, with wave 5 in progress.  There is still a good positive divergence via the MACD for now, so I could see one of 2 things:

1. GDX has a blow out bottom soon, maybe forms a doji or hammer, and the divergence stays in place, then we get some sort of ABC rally up after that.  Watch the candlestick action and how far price is away from the 9 EMA, that can give a trigger via the tutorial method.  

2. 5th waves can extend down and if that were to occur the divergence would be lost and GDX would go a lot lower

anyway the sector has been toxic, I remember some of you back in July were all worried that you missed the bottom LOL and a few complained.  Well..now you see, and as we always say, don't worry about catching the bottom unless you are single and in a night club, trade the trend

short term though followers of the tutorial method could look for a reversion to mean entry if it sets up via the candles and price action