GDX’s plunge deepened on Friday, but subscribers were able to sidestep the so-far 8% dive using a longstanding rally target at 45.71 that caught the tip of last week’s spike within 7 cents. We should view this reversal with more than the usual amount of caution, since the high failed by 19 cents to surpass a small but technically significant ‘external’ peak at 45.96 recorded back in early 2013. To be sure, it would take a print down at 40.20 to even hint of trouble on the daily chart, and we will treat this weakness in the meantime as a buying opportunity. But our bids will be less aggressive than usual, and we may even attempt to get short if a compelling opportunity should arise. Stay tuned meanwhile to the chat room, where crowdsourcing in this vehicle has served us well. _______ UPDATE (Aug 11, 8:35 p.m. ET): You don’t have to be a chartist to see that GDX has farther to fall before it can find good traction. This chart shows two logical places for the correction to bottom: at 36.84, re[resenting a 0.618 retracement of the rally begun from 31.32 in mid-June; and 34.93, equating to a 75% correction. There will be opportunities to trade both sides of the market on the way down, so stay tuned to the chat room for real-time, crowdsourced guidance. ______ UPDATE (Aug 17, 7:0 p.m.): The escape from last week’s bog has been more decisive than I’d expected, but I’m not entirely persuaded it’s for keeps. Let’s see if the stock can impale the 43.17 midpoint pivot shown in this chart. If so, it’ll be presumptively on its way to D=44.39. _______ UPDATE (Aug 18, 6:19 p.m.): An extremely nasty spike, as gratuitous as they come, failed by 30 cents to hit the 44.39 target. I’m going to avert my eyes for a day or two, lest gold’s schizophrenic behavior affect my judgment.
GDX – Gold Miners ETF (Last:42.65)
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