Wednesday, 15 March 2017

GDX - miners explode upward as rates rise

With precious metals soaring as the fed is 'out of the way', the related Gold Mining stocks had a powerfully bullish day. The ETF of GDX settled +7.7% at $22.98. Near term outlook is bullish, as a net weekly gain is due. The mid term outlook is bullish, as the July 2016 highs are set to be challenged this summer.

GDX, daily

GDX, weekly


Higher int' rates are inherently bearish for the precious metals, and by default, the related mining stocks. After all, there is a carrying cost to the metals... and as rates climb, the less attractive the metals are.

However, we're still at exceptionally (if not emergency) level rates, with today's new target range of 0.75-1.00%.

I have little concern until int' rates are at least above 2%, and that looks out of range until at least early 2018.

For those with an interest in the miners...