Re-entry short here in GG
. The rally on Bernanke comments about ready-and-willing QE
stimulus put a pop in GG
shares. If you read the previous chart comments, you can see my thoughts on the decline and now that we have had a good rally on news, it will likely be a decent risk:reward entry for the continuation of the downtrend in GG
shares and gold
mining shares in general. GG
is very similar to the other major gold
stocks. Note that I put GG
as a pairs-trade with ABX
before. Either way, the main point about mining shares is that they have historically had very low returns on capital (source: Yahoo
finance) and over time, capital tends to flow in the direction of higher relative returns.
Risk 3 average ranges. Reward: new lows for this move.
2:27PM EST 3/27/12