Referring to the daily chart of GDX we’ve used to manage many a rally and pullback, let’s take an update of the situation on this probably least valid trading day of the year (in its signals).
Recall that upon a break above the 200 day average and the 30 area, the initial target for the rally was resistance in the 33-34 zone. GDX appears headed for that. Resistance is at 33. The pattern measurement is to 34+.
Dialing the chart out further we find more touch points for the upcoming resistance around 33. We also find the 40+ gap lurking up there as our ultimate trade target of a would-be ‘next leg up’.
The caveat is risk. Holiday trading risk. Broad stock market SENTIMENT RISK risk. In other words, the risk involved because the miners are not yet unique in the macro sphere, running as they are with most everything else.
That said, bullish is bullish and this is a bullish picture for the gold stocks.
As for the broad market situation, I have a lot going on today and until Christmas (the curse of the reluctant last minute shopper), but I feel the need to settle on some kind of strategy before I disengage. On Christmas Eve, 2018 it was so wonderfully bearish that a bullish reversal was in the bag. I can’t help but at least consider whether the opposite could be in play (ref. NFTRH 788) for next week, which everyone is expecting to be ‘Santa Rally’ week. Will those expectations be met?
I may do some selling, may do some hedging or well, I may leave well enough alone. Just thinking aloud. Please consider the above for your own decision making.
