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Wednesday, June 18, 2014

Gold miners indicating multi-month rally

The etf GDX, gold miners, has crossed on 20-50 weekly SMA, indicating a potential multi-month trend change.  GDXJ, junior gold miner ETF may have better return on investment, as well as the etf GLDX, gold miner explorers.

Since the 20-50 weekly SMA just crossed today, it is not yet a convincing indicator.  GDX hitting above 27 I believe will be a clear indicator of trend change.  However, the miners have been depressed for so long, there is a good chance this is the beginning of the final, multi year rally I have been waiting for since April 2011, in post Precious Metals into 2015-2017.

In that post, I violated my own advice with this statement:
I am sitting more on the sidelines as per his paid service recommendations. I am keeping core positions, as I will until this run ends, sometime after 2013.
I grew impatient and started re-entering gold miners earlier, to my detriment.  It is 2014, and I think the down trend may have finally run its course.

Throw into the mix of Iraq falling apart, Russia acting very aggressive, and China always looking for ways to advance itself as the next world super power, any instability should send gold shooting insanely higher.

My original thesis for liking gold is still in tact, that India and China as they grow richer will buy more gold as part of their culture.  See blog post why I like natural resources better than bonds.

Below is GDX 20-50 weekly SMA long term investing indicator, as explained in post when to buy stocks or get out of the stock market.

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