I haven't had much to say regarding gold & gold mining stocks as nothing technical has changed since the highlighted bullish falling wedge breakout in GLD last week on the 60 & 120 minute time frames. That was the first bullish catalyst that I was looking for and as I've repeatedly stated, my primary focus is on gold prices as the miners will ultimately follow the metal.
Although we did get an impulsive breakout of that 60-120 minute bullish falling wedge, there is still some work to be done in order to solidify the longer-term bullish case for gold & the mining stocks. From here, GLD will either go on to break above the July 17th reaction high of 127.40 (bullish) and then, hopefully, go on to take out the July 10thth high of 129.21 and ultimately the March 14th reaction high of 133.69, which would be extremely bullish & most likely confirm that a new cyclical bull market in gold is indeed underway.The bearish case would have GLD making a solid break below the aforementioned 123 support level and even worse, the June 3rd reaction low of 119.42, which would open the door for a retest and possible break of the all-important mid & late 2013 double bottom.
Regarding my upside targets for the exposure that I added back to gold & the mining sector last week, here are my replies to a couple of recent inquired on both the miners as well as a specific trade (AUY):
Q: What are your GDX targets?
A: (from last week)- Potentially much higher. This was my buy-back-in for the next leg up in the metal & miners this week. Given, there is still a lot of technical work to be done, the first major step being a break above the July 10th highs in both GLD & GDX. As of now, my main focus is on loss mitigation (stops) if my analysis looks to be wrong & the metals & miners look like they might go much lower. The a break of the recently highlighted support levels on GLD & SLV would most certainly be bearish. Targets TBD later, for now just watching the price action in gold & silver.
Q: AUY appears to be breaking out. What are your target(s)?
A: Thanks for asking as you just made me realized that I never updated my stockcharts.com chart on AUY from the Live Charts page. I just updated that chart which you can view in the link below or via the Live Charts page. These are the same target levels that were posted on the April 16th entry for the trade, which I still think are valid. I plan to add some suggested sell (price) levels but for now, the horizontal lines mark the resistance levels for the targets.