The HUI ended higher 1.41 points (0.68%) with a close at 210.49. On the daily chart, both the fast and slow stochastics are rising and both are in overbought territory. The slow stochastic is now embedded in overbought territory. MACD is rising and well above the Signal Line. Divergence is rising and well above the zero mark.
GLD ended lower -$0.27 (-0.22%) with a close at 124.42. On the daily chart, the fast stochastic is rising and the K line has entered into overbought territory. The slow stochastic is now embedded in overbought territory. MACD is rising and above the Signal line. Divergence is upward and above the zero mark.
SLV ended lower -$0.08 (-0.48%) with a close at 16.42. On the daily chart, the fast stochastic is rising and the K line has entered into overbought territory. The slow stochastic is flat and fully embedded in overbought territory. MACD is rising and above the Signal line. Divergence is upward and above the zero mark.
The Bulls made a great effort early in the morning opening the HUI at 213.59 and within the first ten minutes drove the HUI to the High of 213.85. All of this on a huge move in gold and silver. The Bears then came in and brought the HUI down to the 210 level where it stayed most of the day, until the Test came. At 2:55, the test began, and the Bears drove the HUI down to 208.23 posted at 3:20 pm. And this is where the real test of the Bulls came. Would the Bulls respond? Were there any buyers waiting to own the gold mining stocks? The Bulls answered the test and drove the HUI back above the 210 level with a Close at 210.52.
I remain long, however, many of my positions were stopped out during the "test". Nice profits on all as I opened small positions last Wednesday, added to that on Thursday, and went all "chips in" on Friday. My position is far more manageable today.
For tomorrow, there is technically a Sell Signal in the HUI since we have a new High and the Close is lower than the Open. For the Bulls defend today's low at all costs and keep the HUI in contact with 212.24. If the Bulls can take out today's High then 215.76 is on the table. For the Bears, take out today's Low (208.23) and drive the HUI back down to 206.37.
GLD and SLV have both posted Sell signals. If today's low is taken out, then look for GLD to fill the gap at 123.02 that formed last Friday.
I have previously posted that we should see a significant High in the HUI between August 17th and September 6th. Was today the significant High? Thus far the "summer rally" has been a retracement rally and not a true Bull move. In order to change that the HUI needs to get up to 222.03 between now and September 6th. For the Bulls time is ticking there are only 5 more trading sessions until September 6th, the cry must be "222 or Bust"!
These are just my thoughts and observations and not advice etc.
As for Wednesday, good luck and happy hunting.
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I am looking for a shallow dip in miners GDX (23-23.5) before launching to new high 26+. Do you believe we just go straight up from here?
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My target numbers on GDX are 22.94;23.30;23.87;24.45;24.80 and 25.42 (1st true "bull" target). We are still retracing the move from 24.88 on April 13th to the low on July 10th of 21.00. I know there is a great deal of excitement and chatter about the new "Bull" market but until that 25.42 is taken out, I am not convinced. September 6th is an important "time" in the HUI based upon a high posted on 09/17/12. It is a "top", now where it goes after that is anyone's guess ie sideways and then up just like this past week. I have significant concerns not just in gold mining stocks but also for the overall stock market. I ran a similar "time" chart for the S&P that started on a different date but showed a "top" in early September, in fact September 6th based upon the low posted on 3/5/2009! Two completely different start dates and both end up on September 6, 2017 showing a "top". Quite frankly, I have never seen that before and it has me spooked. I promised my wife, months ago that I would have little to nothing in the market next week. Does that mean anything is going to happen, no but does that mean something rather drastic could happen yes. I know this is a long reply, but truthfully I am very concerned. I am never afraid to chase the bull but terrified of being ripped apart by the bear. If this is a new bull that makes trading easy, always long.
To answer your specific question, 23.30 would be a back test area, if it goes to that level wait for a simple "buy signal" on the daily chart ie the close is higher than the open and it hit one of those target numbers +/- $0.02.
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Appreciate the reply. I am of the view that the stock market has put in a short term bottom now and the SPY will make a new ATH in Sept - Oct. The next correction could be a big one in stocks. Gold I believe is in a new bull market, I dont think we need confirmation of 25.42 because it has now made a higher high over the last cycle top, also higher lows. Trend is now bullish. I think the correct play is to buy mining stocks on dips, if it dips lower just buy more!
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What I would really like to see, to confirm a new gold "bull" market, is for the HUI to skip several of the target numbers ie 206.37, 212.24 and/or 215.76 and start hitting the numbers at or above 222.03. It would be great if that happened between now and September 6th. The reason would be that if there is a "dip" after that, the "buy" opportunities would be at these levels.
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