NFTRH+; nagging gap filled

The ‘HUI 212’ gap is filling today. Anything below 213 fills it and Huey’s low today is 212.65.

That’s the good news. The gap is out of there.

The not so good news is that HUI is below support and in an ugly daily chart pattern. Also, in the event that the inflation trades take a major hit and we flip from inflationary hysteria to dis-inflationary hysteria, the inflation bugs are selling gold and gold stocks right along with copper, oil, gas and grains. They buy wrong and they sell wrong. It’s tradition in Bugville.

212 was a target established back in 2020 after the sector began its then much needed correction. I had taken my eye off it until the June breakdown below support. We then noted it, it’s filling today and the question remains… ‘shake out and reversal (from this gap) or worsening correction with a potential crash?’

With the bugs I’ve seen on Twitter and other pump stations still holding resolve and shouting slogans, the concern is a worsening and climactic correction. That is a concern for perma-bugs. But for prepared bugs it would be an opportunity to buy what most bugs are selling… for the wrong reasons, just as they bought for the wrong reasons to begin with.

So the bottom line remains the same. If this is a false breakdown we look for HUI to re-take 235 at least before getting at all excited. If it’s the prelude to more nasty stuff, we’ll be glad to have made the sector prove itself before entering Club Misery (as one long-time subscriber so aptly put it).


This Post Has 2 Comments

  1. Barden

    Gary, do you only use HUI for analysis, or also GDX? Websources say:
    HUI (Amex gold bugs) is 18 large- & medium cap gold miners that do not hedge beyond 1.5 years.
    GDX (NYSE Arca Gold Miners) is apparently younger, starting 2006. 47 companies large,medium, small & micro cap, “involved primarily in the mining of gold and silver.”

    1. Gary

      Hi Barden, I primarily use HUI pretty much out of habit over many years. Occasionally I use GDX (GDM) but HUI is the one I have in my memory banks for several important events spanning 20 years, so old habits die hard. To me it is the headline index for gold mining.

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