The hated gold miners are setting up to go higher
Here’s MKM Partners Jonathan Krinsky’s daily log of the Market Vectors Gold Miners ETF (GDX) for your perusal.
"1) The GDX chart continues to work through a multi-year base, that has the potential for a long-term ‘inverse head-and-shoulders base’.
2) $27-$28 is the big resistance level to clear, and represents the neck-line of the pattern. A clean break above $28 would imply a measured move up to $36, which would be a 28% move above the breakout.
3) The 200 DMA (24.20) for GDX is rising, which is supportive to higher prices. We would also use a close below the 200 DMA as a reason to back off a bullish stance.”
From my vantage, the miners have been hated since they began breaking down in 2012. The lower they go, the more maligned by those nursing losses in the individual names and the GDX.
The combination of a chart that is becoming more constructive and the negative sentiment can make for a great combination and so I am watching Krinsky’s 28 level along with the price of gold that remains in the same no man’s land mentioned earlier in this space.
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