GDX daily Feb 10th
The GDX (Market Vectors Gold Mining ETF) long trade has triggered the next long entry or add-on with prices making a solid move above the downtrend line/former first target level today. With the recent consolidation that took place below the downtrend line following the initial tag back on Jan 24th (about 2 1/2 weeks of consolidation), there is a good chance that GDX has sufficiently worked off the recent near-term overbought conditions in order to make a sustained move toward the next target area (T2 zone) in the coming weeks/months. However, should prices reverse over the next few trading sessions, a pullback to the 23.80-24ish level (horizontal resistance) or the downtrend line just below that (on a backtest) would offer another objective entry or add-on to the mining sector. Again, my preferred scenario does not have GDX backtest the downtrend line at this point but if GDX does fall back below today’s low of 24.23 & especially Friday’s high of 23.94 than the odds of a backtest will rise considerable.