RE: your concern of Gold downtrend vs. Miner uptrend is working out (at least at the moment) as I expected if one believes the Miners are once again being “Stubborn” in an attempt to strengthen itself for a double bottom in case GOLD makes a true 1000k (give or take $50) bottom. My thesis is and has been for a month or more now that GDX will be more sensitive on the upside at any Gold rally while limited in downside compared to Gold weakness.
Perhaps what could happen, if Gold finds a bottom around the time for a December Rate Hike (Or NON rate hike), is a GDX settling in a triple (Or Quadruple) bottom? 1.) Early August 2.) Mid Sept 3.) Mid November 4. Sometime in Dec ?
It would coincide with lower lows in GLD
Either way one thing I’m seeing is a Megaphone pattern in GOLD which could culminate in a GLD price target of 115-117 going into Jan. which I believe is what will trigger the new Higher High in GDX @ the 18 level.
Either way I have a funny feeling Gold’s near term movement has been cemented regardless of any FED decision in Dec.
Rate Hike? – Buy the rumor sell the fact – Serious Gold Buying will finally take place
No Rate Hike – Potentially short term sling shot up in Gold from people who may finally realize the Fed’s “data dependent” attitude means Data * 0 will always = 0
RickySixx6- I agree with pretty much everything that you said. On your point about the miners, earlier this year I pointed out the huge disparity between the price of gold & GDX from current levels vs. when both bottomed during the 2008 meltdown. As of today, gold prices are still about 45% ABOVE where they bottomed in 2008 yet the miners are trading about 25% BELOW where they bottomed at the same time as gold in 2008. Therefore, either the miners were extremely overvalued back then (compared to the price of gold) or they are extremely undervalued today (or a little of both). Add to that the price of oil (one of the largest expenses for the miners) is over 70% below where it was when gold & GDX bottomed in 2008. As such, I believe a valuation case can be made for the gold mining stocks from a fundamental perspective, now we just need the charts to confirm a likely bottom, which could come soon.
Gold vs. GDX 2008-2015 by RightSideOfTheChart on TradingView.com
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