The Document

Login Subscribe Now
September 21, 2014

TrendBands Fund Adds GDX

The Market Vectors Gold Miners ETF (GDX) was added to my hypothetical TrendBands Fund this week... on the short side. As Members know, I have been short gold itself since late July. Until early September, the mining sector was resisting gold's slide, offering a point of hope for relentless gold bulls. That point slipped away over the last three weeks, and GDX is now quite clearly in a statistical downtrend.

So we have a pile of bearish signals here. The TrendBand violation defines a downtrend. The bearish break of a typically bullish pattern offers the likelihood of a strong move lower. And gold is unfolding a bearish weekly cycle which still needs several weeks to reach its timing band.

In fact, I have discussed how gold is beginning to convey that crash feeling. After resetting its daily cycle count in the near future, I expect a final leg lower that could drag the yellow metal to a major pivot near $1000. If so, we could see GDX trade in the low teens as long-term holdouts finally capitulate.


blog comments powered by Disqus
Recent Blogs

Macroeconomic Blog | Cycle Trading Newsletter | TrendBands Fund | Library | About | Contact Us | Members