One of the scenarios for a higher low on the HUI monthly chart is a dump and reversal similar to 2016. The other scenario, all within a positive risk/reward is a low that would be made above the 2020 low of 142.51 and/or the 2018 low of 131.12.
Today I got that 2016 sort of feeling. That was the first leg of the agonizingly volatile bull market and you may recall it was a launch and it was led by silver. Well, we’ve been talking a lot about silver lately, eh? Today it slammed upward by 8%. I just hope there is no #silversqueeze type promotional idiocy in play.
Bottom line though is that because we have been tracking improving macro fundamentals I don’t want to take the chance of getting left behind. Yes, a little FOMO. It happens.
SSRM and NEM were added today to go with MAIFF/MAI.V and OGNRF/OGN.V.
If this is THE bottom, as stated previously, I will not have called it. And I am still not calling it. HUI poked through the daily SMA 50, which was step one. But step 1A is to HOLD THE SMA 50. Then make a higher high to September’s high (215.93) and hold that. If it’s an impulsive launch of some kind it should do these things promptly. If not, it should fail soon enough.
GDX and GDXJ each rammed up to their SMA 50s, but have not broken through. This is either some kind of shenanigans at the start of the new quarter or a launch. We’ll know soon enough. One thing I don’t like is that everything else rallied as well (seemingly and fortuitously except for my Tesla short, which I covered when it tanked). But all that stuff was beat down too. So, sentiment relief had some widespread power today as shorts covered.
Here is GDX doinking its SMA 50. Let’s see if there is follow through or failure.