Eying Support in the Gold Miners

With Gold making new highs almost daily, you would think the Gold Miners ($GDX) and Junior Gold Miners ($GDXJ) would follow suit. However, this is not the case. They have both lagged. Nonetheless, I see a trading opportunity coming up in both of them as they near some important intermediate support levels. Below you will find the 15 minute charts of both ETFs. If you wonder why I use 15 minute charts, its simple really. The 15 minute charts help me see intraday action without seeing too much of the action. For example, I would be able to spot support/pivot/resistance levels yet see the bigger picture. That is why I love using 15 minute charts to view stocks.

The Charts

$GDX- The Gold Miner ETF is sitting on MAJOR support. I would watch the $59.60 area to see if it holds. If it can catch a bid from there , I would expect a bounce to $61.75. As you can see, it is making lower highs and is putting in a descending triangle pattern (however, not valid because daily chart not in downtrend) so I would be a seller near the top of that range unless it gets there with volume/strength.


 

 

 

 

 

 

 

$GDXJ- Even though this support is not as major as the aforementioned one, it is still crucial. I would watch $39.15 to see if it holds. If it can catch a bid off that area, I would expect it to bounce back to the short-term resistance area of $42-$42.30

 

 

 

 

 

 

 

 

 

Also, one would have to watch gold (either $GLD or $GC_F) as a proxy/tell on $GDX and $GDXJ. If gold starts selling off, it would be hard to imagine that the gold miners would rally. However, if gold continues its uptrend, I think the miners have a better chance of following suit.

Here are the holdings for $GDX: http://bit.ly/jzpfmE (Excel file)

Here are the holdings for $GDXJ: http://bit.ly/k7iyZS (Excel file)

 

 

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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