Yesterday was an upside whipsaw that I did not take the bait on and chase. It broke through resistance, tapped the underside of the 50 day average and now is back below resistance. It looks like it wants to fill the nearest GDX gap at 37.41, but there is another gap below at 36.18.
Junior miner ETF GDXJ had broken a trend channel, reclaimed it and today is dropping back below the SMA 50 and the lower channel line. That’s another issue that could get traders selling. I do like the looks of RSI on both charts, however. Any lower on those and I will not like them and they would bolster a ‘sell, hedge or just endure’ view in the miners, as the individual case may be.
Overall the situation is still unresolved. The correction is still in force technically until the ETFs and Indexes can take out their 50 day averages and hold them. Yesterday’s failed rise above is a negative omen. The combo of the USD and Gold/Silver ratio is another negative if they continue to be bull biased. And that negative would be for more than the precious metals complex, eventually. The issue is that the market is whipsawing its signals almost daily now. Tomorrow could continue that trend with an up day or it could say “enough!” and kick off a resumed correction. Fun stuff. :-(
