Everybody with eyes to see prices too far above certain moving averages knew that the gold stocks were going to pullback. But as this year has shown so far, a pullback (or consolidation) is far different from a correction.
The sector is confirming a bull market and there are negatives gathering, largely in the form of the US dollar’s support parameter, the adversarial gold and silver Commitments of Traders (with mitigating ‘bull market rules’ that have already forestalled a severe decline much longer than would have been the case in the bear market) and the sector’s own over bullish sentiment backdrop.
But as of 4:08 ET on Tuesday, GDX is only pulling back, perhaps to fill a gap. The EMA 20 (orange dotted) has supported the sector the whole way. That would be the next key.
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