Gold Miners ETF

We gutted it out last week to stay long through a swoon that left GDX little changed from a week earlier. The partial profit we took on half the position gives us 200 shares with an adjusted cost basis of 26.77. Friday's punk performance lagged physical gold, which was up nearly $5 at one point. GDX never went 'green', but it is not likely sit still if bullion's rally resumes or picks up steam in the week ahead.  In any event, offer 100 shares to close for 28.60, o-c-o with a stop-loss on the position at 26.78. If GDX takes out the 26.18 point 'C' low of the pattern, we'll look to re-enter at the first good opportunity. _______ UPDATE (Nov 7, 10:54 p.m.): We were stopped out at 26.78 for no loss or gain. GDX has yet to break down as badly as gold futures, although this will come as scant consolation to those who've held a long position in this vehicle. I'll recommend waiting for a washout down to this 25.22 target before buying. We can adjust if GDX reverses without falling that far. ______ UPDATE (Nov 13): I've asked for help crowdsourcing an opportune 'buy' point for this banana slug. If you're keen to trade it, please leave an actionable idea of your own in either of the chat rooms. ______ UPDATE (Nov 17, 7:44 p.m.): Bears' unimpressive struggle to push GDX lower is starting to seem pathetic. This is ostensibly bullish, but I have little enthusiasm for simply taking a flier. If there's good interest in this stock in the chat room, I'll happily contribute to the discussion and vet actionable ideas.  ______ UPDATE (Nov 18): There was just one mention of GDX in the two chat rooms today -- by 'Johnfed', a new subscriber who

Although the gold futures tout elsewhere on this page sounds a cautionary note, GDX's vicious selloff after a bull-trap opening looks like a fake. Notice that the intraday high on the opening bar hit 28.18, exceeding an important external peak recorded two weeks earlier by two cents. That may not sound like much, but it was sufficient to generate a bullish impulse leg on the intraday charts before the shakedown occurred.  Moreover, GDX was recovering nicely toward the end of the session and appeared bound for at least D=28.39, You can be confident this Hidden Pivot target will be reached if the midpoint pivot at 27.88 gives way easily. ______ UPDATE (Oct 28, 8:17 p.m.): Despite the take-no-prisoners relapse, it is happening after a bullish impulse leg was created on the hourly chart. This means we should be looking to get long. You can set up the trade with this rABC pattern, which would trigger on any 26-cent rally from a point 'C' low. ______ UPDATE (Oct 29, 11:55 a.m.): Anyone who followed my instruction would have gotten long at 27.03.  Assuming a partial profit booked on half at p=27.28 as is customary, we'll continue to hold 200 shares with a cost basis of 26.77. No stop-loss for the time being. _______ UPDATE (Oct 30, 8:50 p.m.): And a good thing we were not using a stop-loss, since the nasty little scumsucker swooned to 26.73 before bouncing manically to an intraday high at 27.49.

For more than a month, we've waited patiently to jump back aboard after a fat score with some out-of-the-money calls purchased in August. GDX is trading about where it was before we bought the options, and so it's probably a good time to hunker down on the lesser charts as we wait for another exceptional opportunity.  The chart shown, going back to July, highlights a rather large, beautifully formed head and shoulders pattern that warrants our attention. I am skeptical of this bearish formation because it tends to crop up everywhere you look for it. In this case, however, the H&S is for real, and not just a hallucination. The good news is that, because it will tend to condition the expectations of technically oriented traders, they will be sufficiently bearish to cause the stock to fly if it suddenly aborts the pattern with a steep, sharp move higher. We'll be ready in any event, cautious but with a bullish speculative bias. _____ UPDATE (Oct 16, 12:36 a.m.): Tuesday's close beneath p2=26.31 was not exactly a sign of robust health. Whatever the case, it argues for waiting until D=25.22 is reached before we attempt to bottom-fish aggressively. In the meantime, we can scalp off rABC patterns as we attempted to do on Tuesday. Stay tuned to the chat room if you're interested. _______ UPDATE (4:56 p.m.): GDX ratcheted higher after opening on a wacky bar that held no easy entry opportunities for us. We'll remain alert. _______ UPDATE (Oct 17, 4:12 p.m.):  Other than a post by Catman, there was no apparent interest in GDX in the Trading Room today. For what it's worth, here's an rABC pattern with a 27.66 rally target that can be used as a minimum upside objective as the week ends. ______ UPDATE (Oct 21,

This vehicle has tripped a 'counterintuitive' buy signal off the 'reverse ABC ' (rABC) pattern shown. Typically, we look to exit these trades at p (in this case 27.77), but since we are not officially on board, we'll use the pattern for forecasting, at least for now.  If price action should generate a textbook mechanical set-up to get long we'll take it, although we don't have much experience using that type of entry in conjunction with reverse ABCs.  If GDX is going to the 29.02 target, it should handle the p resistance with ease. _______ UPDATE (Oct 3, 8:54 p.m.): Today's feint above the red line set-up a 'mechanical' buy if the retracement hits x=27.16 (stop 26.50). This is a so-so opportunity (6.0 out of 10.0) because the point 'B' high is so 'sausage-y'. That means if you act on it, don't bet the farm. _______ UPDATE (Oct 4, 9:16 a.m.): All bets are off, since ambiguous, completely meaningless payroll 'news' has caused stocks and futures to go haywire ahead of the opening. ______ UPDATE (Oct 5): Yes, the trade would have worked perfectly, since GDX made a V-shaped bottom at 27.14, two cents below where I'd suggested bidding. Even with hindsight, however, it still would have been a difficult trade, since gold futures swung $18 in moments when the alleged jobs 'news' hit the tape. These trades are do-able, but not ideally via updates sent out the night before. I hesitate to put out updates every time stocks feint one way or the other, so you'll need to stay close to the Trading Room if you want to be apprised in real time. If I'm not in the room when things happen, don't hesitate to ask others, since there is invariably someone around who knows his Hidden Pivots as

I'd suggested buying on any weakness, but don't rush to load up on calls quite yet. We should be cautious because bulls failed at the top of this week's arc to surpass the 29.76 'external' peak shown in the chart.  Using it as the point 'A' high on the hourly chart yields a downtrending ABC pattern with a midpoint Hidden Pivot support at 28.00. That can serve as our minimum downside objective for the moment, but any lower would portend more slippage to p2=27.21. _______ UPDATE (Sep 29, 1:15 p.m.): Friday's low came within a dime of the 27.21 pivot mentioned above, but I wouldn't count too heavily on it for support. If gold's weakness continues into Monday, here's another view that should be taken seriously. The secondary pivot at 26.31 would warrant more-aggressive bottom-fishing than we might have attempted last week, but it is only near d=25.22 that you should consider backing up the truck.

GDX ended the week strongly on the upswing. I've been eager to stock up on call options ahead of the next big move, but we'll be better served attempting this on weakness. Gold itself is still in a corrective pattern, and although the futures could break out as early as Monday, chasing gold above Friday's highs looks like an unnecessarily risky bet. Straddles have been getting hit hard lately, suggesting that unhedged calls may be the best way to go when the next buying opportunity comes. For now, though, use the 29.03 midpoint pivot as a minimum upside target. We should also be alert to the possibility of a 'CI' short developing. If Friday's 28.69 peak holds, a sell signal would trigger at 28.17. _______ UPDATE (Sep 23, 5:19 p.m. ET): GDX gapped up on the opening and continued higher, leaving timid bulls choking on dust. I will formally recommend trades here to get long only on weakness, but you should tune to the chat room for serendipitous intraday call-buying ideas if that works for you. My 14:31 post in the Coffee House was an example of this. _______ UPDATE (Sep 24, 9:34 p.m.): Weakness on the opening bar demonstrated once again that selloffs in this vehicle are to be regarded as a buying opportunities. My immediate target remains 29.99, posted mid-day in the Coffee House (30-minute, A=27.86 on 9:20 at 12:30 p.m.).

I'd suggested bargain hunting if GDX pulled back on Friday, but the correction was steeper than I'd anticipated. Even so, if you bought calls toward the end of the day as advised, you were in at prices that were just a fraction of what some had paid when GDX was peaking on Wednesday. I am not establishing a tracking position because reports of fills by subscribers were vague. However, if a rally allows you to exit some of your calls for 30% more than you paid for them, you should do so. Alternatively, if GDX continues to fall, breaching the 27.61 low recorded on 8/19, we'll consider a 'counterintuitive' buy. Stay tuned to the chat room for further guidance on this. _______ UPDATE (Sep 10, 9:02 p.m. ET): We took a flyer on the CI trade noted above, but it proved to be a dud, and so I suggested exiting it for a small loss of about $15 per round lot. We'll back away for now, since GDX looks like it needs more time to base for the next rally. _______ UPDATE (Sep 16, 9:08 p.m.): GDX has been base-building as anticipated. I'll be more enthused about buying if it breaches the 26.04 low in the chart, but please note that a print at 27.83 would trip a theoretical buy signal for a shot at 31.52. (120-min, A= 26.04 on 8/1). ______ UPDATE (Sep 18, 10:24 p.m.): A moderate rally has tripped the buy signal noted above, but without generating any heat on the follow-through. I'd suggesting spectating for now, subject to whatever opportunities develop intraday.

GDX held up well last week, considering the fever that gripped non-bullion stocks. I have assumed that most subscribers cashed out of call options acquired for a pittance nearly a month ago. I still hold the 6th Sep 29/31 vertical spread myself and plan to keep it until expiration, since there remains an outstanding rally target at 31.57 (see inset). The spread was marked at 0.87 on Friday, but my order to close out a third of my position for 1.35 (which I announced in the chat room) went unfilled; alas, the spread traded no higher than around 1.20. I would not recommend duplicating the spread with just four days left on it. But if GDX pulls back to x=28.60 by Tuesday afternoon, consider buying a few 6th Sep 29 calls naked as a speculation. _______ UPDATE (Sep 4, 10:45 p.m.): I closed out more spreads today for as much as 1.57 but still plan to hold a few for a shot at full value (i.e., 2.00) on Friday. _______ UPDATE (Sep 5, 10:40 p.m.): A few subscribers reported buying calls, but without specifying which. Sit tight for now, since gold's corrections tend to last longer than a day or two.

When the correction begun around ten days ago from a 29.77 Hidden Pivot target ends, expect the next rally cycle to achieve a gain of about $4. Sellers somewhat dominated last week while failing to do much damage. Considering the menacing look of stochastic indicators on the daily chart, the selloff could have been much worse. Now, the stochastic divergence (see chart inset) has nearly corrected, with the indicator approaching an oversold zone that hasn't been penetrated in nearly four months. This attests to the strength of the uptrend and the enthusiasm of buyers. We can't rule out a downdraft that would shake out the weak hands, but for the moment things look mellow. We continue to hold 6th Sep 29/31 vertical spreads effectively for free, although subscribers have reported variations on this. ______ UPDATE Aug 20, 7:15): A diagonal put spread -- Long 30th Aug 28 puts, short 27th Sep 27 puts -- has comfortably offset the call spread. The first leg of this spread -- buy Aug 28 puts -- was posted in the Trading Room on August 7, and the position has provided insurance against a downdraft. The short side was legged on shortly afterward for 0.02 less than paid for the 28s, making the position nearly riskless. Note that the 28 put will be held 'naked' if GDX is above 28 come Friday when the 27s expire. _______ UPDATE (Aug 23, 10:59 a.m. ET): If GDX rolls over from these levels, or merely rallies half-heartedly, it will generate a third, diverging stochastic peak. (Click here for chart.) This implies that any selloff from these levels could be a doozy. I am at the airport but decided the update couldn't wait. I have a GDX 28/27 diagonal put spread on (see above), but I will not roll it