@JakubKonieczny on point as usual bud.
I just started my short position on a specific gold miner too. especially with this huge bull trap rally, gold should be down.
syzygy1
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giant opening gap up..... check
JakubKonieczny
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@syzygy1, Yes, well, this needs to be attempted carefully. Gold is now higher than where it was when gdxj was at $48. So this gdxj is either nonconfirming the move in metals OR may have a huge catch up move and regain $45-50 area very fast. Especially that gold looks like it just completed a huge inverted H&S from Feb 24th.... if there is another gap up come Monday here then this idea is invalid.
syzygy1
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@JakubKonieczny True, though the ratio of GDXJ to the spot price of gold is higher than it was in 08/15. But it is historically low and coming off an all time low.
EconRuminations
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It fits, even with gold moving up. Miners are of course equities and therefore will suffer with the overall market. Also, many miners are hedged which means higher bullion prices don't always trickle down to net income as they're locked into lower prices. Lastly, it generally does have a lag before higher prices do translate to value even unhedged. This will depend largely on whether or not management gets greedy and attempts to extract as much as possible thereby driving up costs and keeping value stagnant or falling. It's a rat race to be sure. Over all in the longer term this is going to be excellent weakness for investors to be buying into (I think GDXJ could be a 10 bagger a few years out), but for short term trade I'm quite bearish.
PaulDeep19131
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You will be correct my friend, in-fact, I expect the miners to make new lows within the next 4 to 5 weeks.
I just started my short position on a specific gold miner too. especially with this huge bull trap rally, gold should be down.