The rest of the sector is also mashed right up against all time or bull market highs.
I have my doubts that we will see all these resistance levels broken on the first try. We are also deep into the timing band for a daily cycle correction. This would be the most logical level for a corrective move to initiate from.
If gold is in a runaway move then any correction should hold within a 25 to 40 point range. My thinking is gold should drop about 35 points to test the breakout level at $1265.
A throw back to test the triangle breakout by the HUI would also be a normal corrective move.
Once silver & miners join gold at new highs the entire sector will be trading in a vacuum with no overhead resistance. This will be like throwing gas on the fire. And that is the recipe for huge moves.
I just started reading your blog in the last month or so. Excellent work.
ReplyDeleteI've been watching the dollar fall, and precious metals rise non-stop since July. Been holding off on committing hard money to the Junior Gold Miners (GDXJ) and Silver Wheaton (SLW), my two favorites. Every day they have been going up, up, and away. I kept waiting for them to at least pause, to rest, to correct a little bit... you know, give me a chance to buy on a dip, but NO! Now they are up over 30% in that time frame, and still shooting like a rocket. Sickening.
I'm hoping the expected pullback on your "daily cycle low" will give me the opportunity I'm looking for.
Interesting Analysis:
ReplyDeleteStocks should rise as the Gold/Silver ratio decreases:
http://www.bloomberg.com/news/2010-09-22/silver-rally-shows-s-p-500-will-return-to-1-500-amid-growth-chart-of-day.html
The question is.... Do we have to correct here? I had an epiphany in April and a vision that the metals and their shares were going to start a move that goes astronomically higher and will go on longer than anyone could possibly imagine. The monetary expansion that is going to happen I believe will turn our monetary system into something like a digital system that I can only hope will be based on gold. This move is just getting started I feel. I've been in the GDX, GDXJ and a few others since the lows of the summer and they have done exactly what I thought would happen. I think we are bashing the gates and soon the kings head will be hanging from the castle walls! We are winning. Honest money is winning.
ReplyDeleteWHY IN THE WORLD WOULD YOU RISK A MOVE TO 1500 OR HIGHER FOR A SLIGHT 35.00 PULLBACK.
ReplyDeleteWE ARE IN A MAJOR BULL MARKET IN GOLD AND TRADING IN AND OUT HAS ONLY COST PEOPLE MONEY.
STAY WITH THE TREND UNTIL IT IS BROKEN.
SEE VIEWPOINTSOFACOMMODITYTRADER.COM
I'm not sure who you are talking to. I'm still 100% invested. All I did was take down leverage.
ReplyDeleteinvest your fund and dont bother of technicals. the long term bull rally in gold is intact..........
ReplyDeleteStill waiting for the precious metals drop?
ReplyDelete