A few people have asked about shorting gold stocks to hedge. Personally, I am not interested in that at this time and would rather do some more selling since my profitable core has long-since gone to long-term tax status. That said, I am doing nothing at the moment.
But as an example of a setup for those who would hedge, GDX provides one. Last week a big gap down was created. If you want to short a setup then a fill of that gap at 34 could do the trick. Or better yet the converged and down-turned moving averages (35+).
It would also be advisable to have a stop loss in mind, which could be if GDX were to take out last week’s high above the moving averages. Oh and look, there is another gap up there near 37! So that could be a bounce/short setup objective as well. But above the moving averages would also put the downside correction in question. There are other gaps around 39.50 and around 42. Those could fill in the future if/when the sector proves to have been on a shakeout prior to the next big picture leg up.
Not recommending anything, but just laying out views based on some email questions about hedging.
A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the technical parameters are already noted. These updates are meant as a starting point for your further research if interested. I will not personally buy every item highlighted and will sometimes sell (ref. Trade Log) any item that I do buy below target (assuming I’ve not stopped out or sold for some other reason) as I often do. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.
