It has been a long time since I have looked at GLD and GDX on the blog. The trouble is that the charts are not exactly providing easy trades lately. The bounce from the oversold condition garnered a lot of believers in the gold community at first. I saw many declarations that the bottom for gold was in. I think some of that support is wavering a bit now. Here is the daily GLD chart.
The initial rally looks a lot like an ABC correction pattern. Since the C high GLD has moved stealthily down. Kind of like a trend move. A break below the B low would likely accelerate the move down. That would likely spark a retest of the summer low and possibly new lows.
Here is a look at GDX.
GDX has a very similar pattern only it is closer to the summer low. It has been leading GLD down for a long time. Is it doing it again? These stocks have had a terrible year. I wonder if they might experience some tax loss selling in Nov. If that turns out to be the case GDX could provide a good buying op in late Nov. or early Dec. In the mean time I don't see anything to get excited about on the long side.
Bob
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