Nominal daily HUI is doing as projected, testing the resistance level that coincides with the SMA 200. The bad? It’s clear resistance. The good? It’s a gateway to a potential bull phase. Also Huey has come to this point and is not overbought because of the volatility on the way to this point.
Here are Huey’s daily chart ratios to gold (GLD) and the S&P 500 (SPY).
HUI/GLD is at the same important spot, testing the 200 day moving average and also not overbought by RSI.
HUI/SPY as well. We want to see HUI break out nominally and in these ratios for forward leadership and follow through.
Frankly, traders should be evaluating whether they want to take profits or not based on this resistance area. It’s a logical disturbance area.
Personally, since I am stalking a larger move in 2023 I’ll think long and hard before doing that. But I am trying not to be a ground up 2022 style trader. I am trying to be a 2023 holder for HUI’s target of 500 (+/-). So I want to give this move the benefit of the doubt. *
* Famous last words, I know. It’s the gold stock sector, after all.
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I’m giving it “some” benefit of the doubt, but I was uncomfortably overweight. One possibility is that we have correction between NFP today and the Fed meeting. Too many stocks went over upper bollinger bands on a daily charts
Overbought is nice for a launch, but it will have to consolidate at some point. I added a partial hedge (DUST) rather than sell anything.
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