I meant to post this chart yesterday, but after today's move it gives these supports levels even more validity. HUI bounces off up-channel as well as 50% Fib level from the 2008 lows as well as the 61.8% Fib level of the entire bull market. Now, is this the bottom? I honestly have no idea and wont know for weeks, but I can say with pretty good confidence that we at least get a meaningful bounce out of this area, possibly back up to the 50 ma / neckline zone. Many of the major gold equities charts are very broken and need time to repair. About the only major that didn't breakdown was GoldCorp. All of the others need to get back above their respective necklines and hold above them. Going forward the necklines will act as major resistance.
SAND is another gold company I am watching here. This may continue to fall below 8, but that is where I plan to pick up some shares.
FNV is another one that I might consider here soon. I owned this as a short term trade several weeks ago and sold for a small profit.
Relative to gold, the majors have never been this cheap. This week the ratio feel to a new low. A couple years and all of this will be a distance memory when gold and gold stocks are significantly higher.
Just how bearish are investors towards gold stocks? – extremely bearish. The chart above makes that very clear. It shows that with only 3% the gold stocks that make up this index are currently in a bullish point and figure pattern. When this happens, you are at or very close to a bottom. Could it go lower? Yes, it could drop to zero, but again we are closing to a bottom that some sort of top.
The Rydex Funds again show that gold stocks are completely out of favor and have been for a long while.
Low risk trade here on coffee as the spot price is currently at long term support. One can trade coffee by purchasing the ETF "JO".
Please click above to expand this chart because its easier to read if viewed larger. Today marked the 4th most oversold daily RSI reading in 30 years of the XAU chart. The bottom may not be in, but a bounce is right around the corner. Readings like this don't stay this low for long, as we have always had at the very least a snap back rally. Last years reading of 21.53 marked the exact low.
WLT looks like it will breakout tomorrow. Trigger would be a breakout over the trendline with a stop under the 50 ma.
T1 was hit, I'd consider taking full profits as the entire gold complex is very oversold and ripe for a bounce. Original trade idea below.
I listed DNN as a potential breakout back in late December over 1.30. Well we had a great run upwards towards resistance and have now come all the way back to the breakout zone. Currently DNN looks to be finding support in this zone. FYI....DNN is my largest uranium holding and I have been an active buyer at these levels.