When they start telling you it’s a blow off move in GDX (and the gold miners in general) you might want to be a little suspect of that proclamation. After all, there are a lot of FOMOs* getting hot under the collar out there as mainstream money is only now just starting to pay attention. The old miner in the picture above has been pushing that damn cart for so long now. It’s about time he got some help!
It is more likely the next phase of a launch. The caveat is the two most recent gaps, which may need to fill at some point as 30.50 is now becoming major support. The lower gap? That’s now getting confirmed as a breakaway gap as it thrust GDX above two key moving averages on good relative volume and has resulted in a change in the trend back to decidedly UP. With the uptrend now reestablished people should do the work required in managing this sector closely from here on; and I don’t mean just this week’s excitement (although day traders gonna day trade).
* FOMO = Fear of missing out.
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