Thursday’s encouraging leap fell a tad shy of the 38.06 target shown, but this should be of little concern to bulls, since the rally exceeded several peaks, including a daunting ‘external’ one at 37.13, before buyers called it a day. The move is therefore strongly impulsive on the daily chart, implying that any impending bout of weakness should be used as a buying opportunity. Eventually, our attention can shift to the 42.13 peak labeled in the chart (see inset). To stoke the born-again bull, if it is one, this peak will have to give way to the next big upthrust, and thence, even more bullishly, the somewhat higher ‘marquee’ peak at 43.54. How easily this vehicle gets past those benchmarks will tell us what kind of buying power is driving the rally. In the meantime, let’s wait until the target is reached and GDXJ retraces before we attempt to do any new buying. ________ UPDATE (Jan 8, 11:18 a.m.): The 38.06 target was narrowly missed, but because the thrust was bullishly impulsive we can still try to get aboard ahead of the next push. Use the pattern shown to support a ‘mechanical’ entry at x or p, or any of several other tactics we have in our arsenal. If you are unfamiliar with them, tune to the chat room and The Scoreboard for guidance in real time.
