GDX Gold Miners First Take Profit Reached, Still Long Short Term
Updated
This is a continued trade based on my previous post. This was posted on my blog yesterday night
We have a big week ahead of us with potential updates on several important political event, along with some important economic data being released throughout the week. The news that we should keep our eyes on are updates on the trade deal, and vote outcomes of the Brexit extension set to be voted on Wednesday. US and China are in what seems like the final stretch of signing a trade deal that could help boost the world economy, however we can’t discount the multiple occasions where US trade reps admitted that there are still issues which need to be resolved before a deal can be made. As long as investors are still in the dark, markets will likely trade in a range as the speculation continues.
Wednesday is looking like a big day in terms of catalysts that could drive the market in one direction, at least in the very short term. We have the decision on the Brexit extension, as well as CPI numbers coming out in the US. These indicators and events could help Gold break out of its recently tight range and make a strong push in one direction. As previously mentioned in my daily posts, Gold has been consolidating at the bottom end of its descending triangle, meaning it’s found support and more likely to breakout to the upside than downside. As of writing this, Gold is up 0.4% overnight so far and I believe it’ll push up to at least the downward trendline.
The US dollar is still relatively flat, and looks to be consolidating as well near the top end of the ascending triangle. My current view is still that it’ll likely trend down after some more sideways trading, however my thesis depends on the price action this week so stay tuned for my daily updates.
Yields are starting to slip as investors wait for more catalysts, with CPI numbers and the Fed minutes being the most important ones this week.
Gold miners will likely continue its short-term trend upwards given the bullish sign from Gold. While I am bullish on miners in the short term, I will be actively taking profits as it hits the previous resistances marked on the chart. My medium term view is still unclear and depends on further macro development and more concrete directional news flow. I will also be watching the price action throughout the week to gauge sentiment that might be helpful in my predictions.
Have a great trading week everyone!
We have a big week ahead of us with potential updates on several important political event, along with some important economic data being released throughout the week. The news that we should keep our eyes on are updates on the trade deal, and vote outcomes of the Brexit extension set to be voted on Wednesday. US and China are in what seems like the final stretch of signing a trade deal that could help boost the world economy, however we can’t discount the multiple occasions where US trade reps admitted that there are still issues which need to be resolved before a deal can be made. As long as investors are still in the dark, markets will likely trade in a range as the speculation continues.
Wednesday is looking like a big day in terms of catalysts that could drive the market in one direction, at least in the very short term. We have the decision on the Brexit extension, as well as CPI numbers coming out in the US. These indicators and events could help Gold break out of its recently tight range and make a strong push in one direction. As previously mentioned in my daily posts, Gold has been consolidating at the bottom end of its descending triangle, meaning it’s found support and more likely to breakout to the upside than downside. As of writing this, Gold is up 0.4% overnight so far and I believe it’ll push up to at least the downward trendline.
The US dollar is still relatively flat, and looks to be consolidating as well near the top end of the ascending triangle. My current view is still that it’ll likely trend down after some more sideways trading, however my thesis depends on the price action this week so stay tuned for my daily updates.
Yields are starting to slip as investors wait for more catalysts, with CPI numbers and the Fed minutes being the most important ones this week.
Gold miners will likely continue its short-term trend upwards given the bullish sign from Gold. While I am bullish on miners in the short term, I will be actively taking profits as it hits the previous resistances marked on the chart. My medium term view is still unclear and depends on further macro development and more concrete directional news flow. I will also be watching the price action throughout the week to gauge sentiment that might be helpful in my predictions.
Have a great trading week everyone!
Note
Follow me on my blog for daily updatesgdxdaily.com
Note
Gold and gold miners jumped today as predicted, as well as the sell off once it hit the first resistance. The intraday swing on 
NUGT was around 4%, which provided us with some great opportunities to add to our positions. I expect gold miners to continue to push through this first resistance and reach the second resistance. The second resistance point is important and I would be looking to liquidate most of my position and re-assess whether the medium term outlook is bullish for the miners.
Of course I'll be posting my thoughts in more detail regarding that in the next couple of days.
Happy trading team!
Note
Check out my blog at GDXdaily.com for more detailed forecasts!Trade active
Gold surged past the $1300 resistance as I predicted, allowing GDX benefit from the bullish momentum and gap up around 0.3%. One thing to note for today is that the CPI numbers, Brexit vote and FOMC meeting notes all come out tomorrow. When there's this many catalysts occurring on the same day, it can lead to volatile trading that's less predictable than normal.
Therefore if you have gains from the past few days of trading with me, and if you don't want to "gamble" 80%-100% of a full position, then I would suggest trimming down your position size with the opportunity presented today with the surge in prices.
Trade active
GDX is currently trading relatively flat, even though Gold prices are up +0.5%. This kind of deviation can be expected since miner stocks do have correlation with the broad equity market as well, expressed as their beta. As long as your cost base is somewhere below 19.4 then I would still be comfortable holding into tomorrow. However please refer to my update above explaining why you should trim down your position if you think it's too large to take gamble with.
Trade active
Just closed 50% of my current position at $20.7 for a gain of 6.97%. Leaving the other 50% to gain exposure to the catalysts tomorrow, will post an update on my blog tomorrow evening regarding the new trade path prediction. Stay tune!
Note
Make sure to set your stop loss tight for tomorrow, don't want to give back the gains we made today if catalysts produce negative pressure on Gold and the miners.Trade active
Gold and Gold Miners prices jump on higher than expected inflation, and a renewed statement from the ECB that they're going to hold rates steady. Waiting until the Fed Meetings notes before predicting a trade direction.
Trade closed: stop reached
Stop Loss at $20.60 hit, sold remaining 50% position of NUGT with a gain of +6.45%. As predicted in my post yesterday on my blog, Gold and Gold Miners prices sank after Fed minutes revealed that they may begin raising rates if inflation picks up.
Will be updating more tonight/tomorrow. Be sure to look out for my next post soon.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.