Metals and Miners continue to consolidate. Prices move pointedly one day and then reverse the next. There is little to no follow-through in either direction, and that makes trading difficult.
Gold and silver are near critical support. They are holding these levels, but a sharp decline remains possible. If we are going to see a breakdown, it should occur within the next few trading days.
The same analysis applies to stocks and oil. I see the potential for sharp declines, but this window is closing.
There were decent buying on weakness numbers in GDX today (163-Million).
US Dollar – Prices tested the 95.80 level again and reversed sharply. The dollar needs to close above this level to signal the next advance. If prices pullback here, they need to maintain closes above the 94.25 level to prevent a failed daily cycle.
Gold – Prices are flirting with critical support at $1184. If we are going to see a breakdown, it should occur between now and Friday.
Silver – Prices continue to probe the cycle trendline, no breakdown yet. If we do see a sudden collapse, it will likely slash through the $13.97 low. The next few days are crucial.
GDX – An uneventful day in miners. Prices would have to close above yesterday’s high ($18.90) to support more upside and today’s buying on weakness. However, significant resistance remains near the $19.75 gap. Closing below the $18.14 pivot would likely trigger another sharp sell-off.
GDXJ – Juniors are in the same boat as GDX.
SPY – Stocks finished the day with a small Doji cross. It feels like we are at an inflection point. If this thing is going to break sharply lower, it needs to do so soon. I’ll exit the remaining 50% of my TVIX position if prices aren’t heading lower tomorrow or Thursday.
