First To Reverse
For the evening/overnight session, both gold and the S&P futures have opened lower.
The S&P is down 50-pts, nearly 1.10% (at about 8:15 p.m. Eastern) and already penetrating the last session’s low.
The number of technical factors concerning gold, the miners and especially the Junior Miners GDXJ, is significant.
We’ll cover just a few in this update.
Junior Miners, GDXJ: Daily
The un-marked daily chart shows GDXJ oscillating but in a general downward trend:
The next chart shows price action posted a reversal bar right at Fibonacci 23.6%, for the entire move; from the breakout highs in mid-November ’21, to the lows on January 28th, this year.
A ‘Fib’ retrace of 23.6%, is rare and if it holds, indicates significant weakness.
The next two charts present a case for why this shallow retrace may indeed hold and thus, indicate the start of the next leg lower.
On a print basis, it’s been a Fibonacci 55 (+1) days from the GDXJ print high on November 12th, 2021, to the high posted today (2/2/22).
The next chart shows that November 12th, 2021 was also the closing high of the breakout set-up.
The Important Part:
Yesterday, was the closing high of GDXJ (so far) and that makes it a perfect Fibonacci 55-Days, from peak-to-peak.
The last update on the miners showed significant down-pressure at support levels, unlike previous visits to the area.
Looks like we’ve had the rally that was forecast; that rally may now be fading.
“It’s reasonable to expect an attempt to rally in the coming week … but with this much down force, a successful rally is not the high-probability outcome.”
Gold Could Hold
Already discussed, is the idea, the actual price of gold may hold steady or even go higher and yet the mining sector collapses.
As Dan from i-Allegedly posts in this report, Italian wine makers are having a hard time getting corks for their bottles. That’s right, corks !!!
Does anyone really think a massive mining outfit is going to be able to source all they need to continue operations without interruption?
Let’s not even get started with the ‘sustainability’ corporate failure already baked into the cake 🙂
‘Stackers’ … We’ve Got You Covered
Right in time for spring planting.
But wait, there’s more; look at the fire chief’s comments. How many “33s” can you count?
For we wrestle not …
“For we wrestle not against flesh and blood, but against principalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places.”
Gold & Silver
Hard assets: Good to have for sure (ammunition, seeds and egg-laying hens may be better) … but if we’re really in a similar event to Genesis 41, that means the corn and grain come first, then gold and silver.
This post started with the S&P down about -0.80% and it’s now down -1.10%, posting a new daily low.
Gold is down slightly, holding steady but that’s already been discussed above.
Remaining short the sector via JDST-22-01 (not advice not a recommendation).
Position size on JDST-22-01, has been increased. More on that in the next report.
Charts by StockCharts
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The Danger Point®, trade mark: No. 6,505,279