As vexatious as the rally has been, it’s time to adjust the 36.90 rally target we’ve been using upward with a new one at 38.61 (see inset). The pattern has produced just one ‘mechanical’ buying opportunity that occurred on a sharp pullback to 31.68 two weeks ago. But all retracements since have been too weak to generate a similar set-up. I mentioned in the chat room that GDX trades almost as viciously as grain futures, and that’s why we need to get long only with close adherence to Hidden Pivot rules intended to minimize risk. For that reason, I will leave open the trading of it to whatever opportunities develop intraday. This is a crowdsourced project, so don’t be timid about contributing to the effort if you know your ABCs. ______ UPDATE (May 19, 8:36 p.m.): Yes, it’s okay to buy a few soon-to-expire, out-of-the-money puts if GDX gets within 0.11 of the target. Don’t risk more than you can lose painlessly. _______ UPDATE (May 21, 9:04 p.m.): What a huge surprise: GDX has plummeted without having quite reached a clear and compelling Hidden Pivot target. It remains viable in theory, but you know the drill: two steps up, 1.90 steps back. _______ UPDATE (May 24, 5:15 p.m.): If June Gold is trading minus $4 or higher, you can use the 35.08 midpoint Hidden Pivot shown in this chart to bottom-fish cautiously. Specifically, a 35.10 bid should be employed in conjunction with a 34.97 stop-loss. The order is good for the first hour only, and you should check here and in the chat room to make sure it hasn’t been revised. _______UPDATE (May 26, 9:39 p.m.): Bottom-fishing at 33.74 looks enticing, but it’s unlikely to yield an easy winner because it’s too close to some May 13 lows that the yo-yos will be focused on. We may be able to improvise, so stay close to the Trading Room for possible guidance in real time. _____ UPDATE (May 27, 9:45 pm.): GDX gapped open well below the 33.74 pivot we’d considered bottom-fishing. The opportunity came later in the day, but catching a ride would have been labor-intensive, as we learned during today’s tutorial session. I am still encouraging crowdsourced entry strategies, since this stock is just too much work to stay on top of. It is by no means out of the woods, by the way, since it would take a more than $2 rally from current levels to generate an impulse leg on the 30-minute chart. _______ UPDATE (May 28, 10:31 p.m.): Interested in owning GDX? Stay tuned to the Trading Room, where I’ve encouraged a crowdsourced approach to building positions in this oft-irritable ETF.
GDX – Gold Miners ETF (Last:33.99)