The recent surge missed my 86.41 rally target by 1.64, but the chart leaves little doubt it will be reached eventually. As much is clear in the ease with which buyers penetrated the midpoint Hidden Pivot resistance at 75.16 the first time they encountered it. Now, if this vehicle should relapse sharply, touching p=75.16, that would trigger a 'mechanical' buy at the red line, stop 71.41. Failing that, it could still offer excellent tightly stopped bottom-fishing opportunities at either 81.47, or at 78.17 if any lower (60m, a= 70.53 on July 22).
Bulls blew past a longstanding rally target at 78.28 last week with such brio that I've shifted my sights to a new objective at 86.41. GDXJ looks all but certain to get there, given that its ascent impaled p=75.16 on first contact. The pattern is somewhat unusual because of the subdivided A-B leg, but the midpoint Hidden Pivot (p) should prove reliable nonetheless for projecting an easy move to the corresponding 'D target. Once the rally hits p2=80.78, a relapse to the red line, however unlikely in a move this strong, would trigger a 'mechanical' buy at p=75.16. The stop-loss would be at 71.41.
Careful! GDXJ's behavior has been feral the whole way up, albeit with no big surprises. Now it is closing on a 78.28 target that has been three months in coming. That implies the target, a Hidden Pivot, should show tradable stopping power, even if the blunt obviousness of the pattern will likely work against a top occurring precisely where it ought to. If you've held onto a long position all the way up and want to keep it, or part of it, consider writing some near-the-money calls with an expiration date no more than 2-3 weeks out.
I've settled on the hourly chart, with an ambitious rally target at 78.31, as our lodestone. The gap through p=71.12 on first contact is not merely encouraging, it is highly favorable toward the continuation of the uptrend to at least 78.31. There is also reason for caution just above, at 74.72, a secondary Hidden Pivot that closely coincides with the 74.88 'D' target of an alternative pattern displayed here last week. An imminent stall seems likely, but if it is brief, you can take that as evidence D will be achieved.
This proxy for gold exploration stocks has had quite a run-up this year. Most recently it exceeded a 72.23 target first disseminated here a long time ago. To come up with a higher projection, I had to shift the point 'A' low from 2020's watershed bottom at 19.62 to the 16.87 low recorded in January 2016. This allows GDXJ a little more running room, but not much. The pattern is extremely gnarly, but it is also the only logical extension possible. That is why you should pay close heed if the uptrend continues into August.
The rally has sputtered out in a bad place, more than a little shy of the 74.87 target I'd flagged. I still expect that Hidden Pivot to be achieved, but we will need to be careful about where we re-board or augment long-term positions. For now, I'll suggest bidding 66.14 with a stop-loss at 63.23. This is a textbook 'mechanical' buy, but it is somewhat riskier than attempting it at the green line (where a 57.40 stop-loss would apply). If it comes down to that, we should initiate with a 'camouflage' trigger. This means using a pattern of small degree to signal a 'buy' at its point x, 25% along the C-D leg.
You can be confident the bull market will reach the 74.87 target shown, given the way buyers speared p=66.14 on first contact. This target is slightly higher than the one given here previously because I've switched to a daily chart that uses a 'marquee' low at 49.33 as point 'A'. This is justified by the power of the impulse leg, although we should still be alert to a possible stall at 74.11, the original target. More immediately, be ready to attempt a 'mechanical' buy at the red line (p=66.14) using a 63.23 stop-loss if the opportunity should arise.
Last week's sharp reversal laid waste to a bearish target I'd proffered at 53.51. The switch to a conventional pattern shows there is now upside potential to as high as 74.11 over the next 2-3 weeks. More immediately, buyers will need to get past the 65.78 midpoint resistance shown in the chart to become an odds-on bet for a run-up to the target. Once achieved on a closing basis for two consecutive bars, you can use p2=69.95 as a minimum objective. A one-level pullback should be regarded as an opportunity to get long. _______ UPDATE (Jun 2, 11:58 p.m. EDT): The week has opened with a powerful short squeeze that sent this vehicle soaring to a so-far top just 19 cents shy of my minimum upside objective at 69.95. Now, a two-day close above it will all but clinch a finishing stoke to the 74.11 target.
GDXJ looks vulnerable enough to fall all the way down to 53.31. The outcome may not turn out to be quite that bad, but your trading bias should be bearish for the time being. The silver lining is that if GDXJ should fall to the target, it would provide an unbeatable opportunity to bottom-fish with a tight stop-loss. This is a back-up-the-truck number, and so I will not make this tout publicly viewable. The last time I did this was in MSFT, which dropped $11 after getting within an inch of a 450.24 target that was 'blacked out.'
I've flagged two rally targets that lie, respectively, at 72.23 and 111.59. The first is 'guaranteed' to be reached, but I cannot yet certify the higher target as a sure thing. However, GDXJ will be drawn more immediately to the 66.71 midpoint Hidden Pivot of the pattern shown (see inset). The likelihood of this increased with last week's failure to reach the 'd target of a minor bearish reverse (rABC) pattern. If buyers pop it through p=66.71 easily, this vehicle would be on track for a move up to 75.04, a tad better than the assured objective at 72.23.
