SchalkLouw

Going for Gold might be Going Nowhere for Now

AMEX:GDX   VANECK VECTORS ETF TRUST
Strong short-term support level broken on Friday, indicating that further possible downside ahead. Should Friday’s break not turn out to be a false break, could see GDX test previous support level at $32.20.

We also saw the short-term 8-day Moving Average ( EMA ) break below the longer-term 200-day EMA , which is a clear indication that it might just get a bit darker before it turns bright again. All four the 8-, 21-, 50- and 200-day EMA’s are now point downward, clearly indicating an unhealthy short-term trend.

The 14-day RSI is also not in oversold territory yet, which confirms that more weakness is possible going forward.

I still believe with the amount of stimulus the US is pumping into their economy could have a positive effect for Gold and ultimately the Gold Miners over the longer-term. Patience however will be import over the shorter-term.

I expect GDX to test the $32 levels soon, just to rebound and test $38. Any traders who’s currently long, could watch $32 as a possible stop-loss, with a break below these levels, most probably bring back the mid-20’s into play. A break and close above $38 could be extremely bullish for GLD .

In short – hold for now, while accumulating/buying into further weakness.
Comment: Break back above the trendline yesterday, indicating a possible false break on Friday. Will monitor closely.

Comments

Looking at Gold futures (GC) it seems that today's (Jan 18) price action on Daily is showing signs of forming a "hammer-like"candle, but this will have to be confirmed by market close price today.
If the hammer forms and gold price remains above $1800 I lean towards a bounce higher again.
I agree with your synopsis of holding and accumulating for the long term.
Reply
Thank you for chart . Agree that gold price is going to experience some pain before going up again.
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