Tuesday, 31 December 2013

GDX - a year of pain for the Gold miners

Whilst the broader equity market saw very strong gains across the year, the Gold miners saw very severe declines. The Gold miner ETF of GDX settled @ $21.13, a 2013 decline of $24.83 (-54%). The bigger monthly cycle is not yet offering any clear sign of a turn.

GDX, monthly

GDX, daily


2012 close: $45.96
2013 close: $21.13    net decline; $24.83  (-54%)

Along with the precious metals themselves, the miners have been in a world of hurt since the peak in late spring 2011. With Gold slipping from the $1900s to the upper $1100s, it has been no surprise at all to see the broad ETF of GDX having collapsed over half.

2014 outlook

First, I should note that I see Gold eventually flooring at $1050/950 in 2014/15. If that is the case, it'd be highly suggestive that the miners still have some way to fall.

For GDX, that probably means a hit/test of the 2008 low in the $15s, before we see a decisive turn on the bigger monthly charts.

Best guess...GDX fails to hold the $20s....eventually hits the mid teens..before forming a key mulit-year floor.