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Wednesday, May 21, 2014

GLD and GDX 5/21

Well, not much happened since my last post.  The volatility in both these ETFs has collapsed.  The higher level double bottom I mentioned in GLD has not garnered any buying.  Here is the daily GDX chart.

GDX is testing the recent lows.  It has been under the 50 SMA long enough that MA has turned down pretty sharply.  It has also fallen back below the 100 SMA.  This looks like do or die time here.  Lets look at the GLD daily chart.

GLD is still hanging on to the 100 SMA.  Like GDX the 50 SMA has turned down again.  With the volatility contracting it does appear these ETFs might be preparing for a big move.  The direction of that move looks a little uncertain to me.  They need to show more strength to convince me they are ready to go up.  If GDX does not break down then maybe buyers will step in.  If GLD joins GDX in breaking down below the 100 SMA it could end up testing the Dec. low.  I think I would want to see this break out above the 50 SMA before getting bullish again.  Between the 50 and 100 MAs it just looks like noise.


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