Friday, 28 November 2014

GDX - severe declines into the weekend

With the USD on the rise, and Oil prices in collapse mode, the precious metals saw similar severe declines (Gold -$30). This naturally impacted the mining stocks, the ETF of GDX settling lower by a rather extreme -8.7% @ $18.36... primary target remains 15/14s.

GDX, daily

GDX, monthly


*it is notable that GDX managed a net monthly gain of 6.7%, a significant gain on any basis, but the manner in which the precious metals AND mining stocks closed the week, is very bearish for December/end year.

So... a severe snap lower.. and with weakness into the early close of 1pm, GDX effectively imploded, unravelling around half of the gains from early November.


Holding to original downside target of Gold $1000/900s...

.. which has dire implications for the mining stocks. Gold in the $1100/1050 zone would likely equate to GDX 15/14s.. and that is possible before year end. Gold around the 61.8% golden fib ($890s) would likely equate to GDX around $10.... although even if that is the case, it will take a further 4-6 months to reach that depth.

*I remain short GDX.. seeking an exit in the 15/16s.