Let me just add (to the previous two posts) that I have not yet determined if I am going to start adding back exposure to the mining sector just yet. As I’m just starting to analyze the charts of the individual mining stocks, I’m not overly impressed with what I see so far. As I stated in the previous post, GDX may very well find support somewhere around this S1 (formerly R1) support zone, which runs from about 26.40 to 25.90 (we are currently just above the top of it now) but I do give slight odds to a continued move down to the yellow uptrend line (which would come in around 25.70ish, assuming prices make it there in a few trading sessions). I will continue to review the charts on both the metals and individual mining stocks and follow up with my thoughts as well as any interesting candidates. If I do start accumulating shares of the mining stocks soon, it will be on a gradual scale-in basis (adding fraction positions over the upcoming days/weeks).
Just a quick side note on my overall positioning: Although the SPY has now clearly taken out the 60 minute downtrend line today (after closing just marginally higher yesterday), I am waiting to see how the SPY handles that significant gap resistance pointed out early today before making any changes. The SPY gapped right towards the top of that previous gap and has struggled with it all day so far. The with the R4 downtrend line clearly taken out now, the odds have definitely increased that the SPY will go on to make a new high but it still has to break & close (solidly) above the current resistance level before that can happen. As I type, the SPY just closed basically within pennies of that Aug 15th gap so for now, I remain next short with select long hedges and may begin to start adding back some exposure to the metals and mining sector. I also plan to begin reducing my short exposure should the markets continue to build on today’s gains going forward.