GDXJ LONGReally like GDXJ here, might be more of a chase then a reversal trade which is tougher for me but there's a few solid points in favor of the bulls:
- 50 dma has held perfectly during this period of consolidation, (also coincides with daily support trend line), just as it did in mid June before taking off
- its begun to break out of this mini daily triangle and has consolidated between 2 key resistance levels the previous 2 days
- looking to validate the inverse h&s its been forming over the last month
- the price action of these guys while the dollar has bounced significantly off the lows, gold & silver doing pretty much nothing as well as equities experiencing a pretty harsh sell off during this consolidation period shows strength in the sector
-RSI has remained bullish, not been below 40 since beginning of post-covid bounce
while its easy to layout the bull case, we can also layout the bear case
- a $DXY confirming its attempted daily trend change would be short term detrimental to the pm complex, as well as equities so miners would get knocked down pretty hard
- one could say the lack of follow through on the inverse h&s proves there's not a lot of buyers up here
A daily close below the daily support line would be my exit, looking to reenter at the 50dma
While I am uber bullish on the pm complex MT-LT, we could be looking for one last decline prior to the next leg higher. However the resiliency in the price action of all the miners during this consolidation period is definitely a point for the bulls, and subsequent follow through could be explosive.
