Recently, the gold and gold mining stocks have surged higher over the past three weeks. The highly followed Market Vectors Gold Miners ETF (NYSEARCA:GDX) jumped higher by more than $4.00 a share since May 29th, 2014. Today, the Market Vectors Gold Miners ETF is trading lower by 0.37 cents to $25.90 a share. The GDX is now overbought on a daily chart, so a pullback over the next couple of days to weeks should be somewhat expected. While a pullback is possible, traders and investors must now keep an eye on the weekly inverse head and shoulder pattern that is forming on the chart. A weekly chart close above $26.00 a share on the Market Vectors Gold Miners ETF would trigger a buy signal for the pattern. The target for the bullish inverse head and shoulder pattern indicates a move up to the $35.00 area.
Leading gold mining stocks such as Royal Gold Inc (NASDAQ:RGLD), and Goldcorp Inc. (NYSE:GG) also have the same weekly chart head and shoulders pattern as the Market Vectors Gold Miners ETF (NYSEARCA:GDX).
Please understand that these patterns have not yet triggered, so until they do these equities could still be somewhat volatile in the near term.
Nick Santiago
Chief Market Strategist
www.InTheMoneyStocks.com
Leading gold mining stocks such as Royal Gold Inc (NASDAQ:RGLD), and Goldcorp Inc. (NYSE:GG) also have the same weekly chart head and shoulders pattern as the Market Vectors Gold Miners ETF (NYSEARCA:GDX).
Please understand that these patterns have not yet triggered, so until they do these equities could still be somewhat volatile in the near term.
Nick Santiago
Chief Market Strategist
www.InTheMoneyStocks.com