‘Bump & Run’ … Gold Miners

Upside Test Can’t Hold

With less than an hour into the session, Junior Miners (GDXJ), have tapped upper resistance, pushed past by just 0.07-points, and are now eroding to the downside.

If the index continues lower, it has the classic near textbook look of ‘bump and run’.

It’s a price action response to stops placed just above resistance that get executed and then the market continues lower.

If that’s the case, it could get very serious to the downside (not advice, not a recommendation)

Short positions via JDST, have been maintained with a hard stop at today’s JDST, low of 5.974 (not advice, not a recommendation).

Charts to follow.

Stay Tuned

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

Too Much … ‘Debt & Disruption’

Another Planned Event ?

So, how’s any business going to operate profitably in an environment that’s systematically being disrupted?

Those that could come up with a plan (for their company or business) in such an environment, i.e., the ‘competent‘, are leaving in droves; letting the slackers, back-biters, corporate gossips, and the incompetent, finally have free rein.

This phenomenon likely applies to all major businesses. We already see the entrenchment.

Then, The Fed

Then, there’s the Fed. Surely, when they see how bad things are, they’ll lower rates; Right?

‘When the Fed realizes the economy’s in a recession, they’re going to lower rates‘.

That’s ‘normalcy bias’. We’re in a new construct: There’s no Fed ‘pivot’, rate lowering, or any ‘accommodation’ in sight.

On top of that, some have figured out, things aren’t quite right at the Fed; looks like different ‘forces’ are at work.

Go to time stamp 10:50 at this link (warning, contains profanity).

Then, The ‘Stackers’

So, we’ve gone from stacking toilet paper to stacking what’s thought to be precious metals.

The question is … are they real or fake?

First, it’s fake silver … and then, even the Perth Mint got into the act with ‘diluted’ gold bars.

As stated, years ago, during the Texas Freeze, when it really hits, the grid goes down, nothing’s working, it’s freezing outside, precious metals are nowhere on the list (not advice, not a recommendation).

Then, The VIX

As if all of the above was not giving us clues that something’s about to happen, there’s the VIX.

Volatility is down … way down … too far down.

All of which bring us to the topic at hand.

Now, The Debt

If you believe the talking heads and ‘finance’ YouTube sites that claim the debt deal will cause massive inflation, well then, let’s pose the following question.

If that was true, why are gold and silver not responding in a huge bull market with upward leaps (a la 1995, S&P) each day, then week and month?

Those close to the market always know something; their actions show up on the tape.

It could be we’ve already past the top in spending …. just by market pressures alone. It’s possible, all that extra allocated ‘pork’ may never get implemented (not advice, not a recommendation).

Lastly, The Miners

The miners GDX, GDXJ, have been in a bear market for years with all-time highs (GDXJ) during the first half of 2011.

Since then, the sector is down over 72%

It’s interesting, that this high stress, physically demanding industry with risk of danger ever present (here, here and here) reached a bear market peak in mid-2020, just as certain ‘items’ were being mandated.

Junior Miners GDXJ, Daily

As the competent leave the general workforce, would the resulting lack of accountability make itself known first in professions where stupidity causes direct effect in reduced production and/or increased accidents?

The GDXJ is at an interesting juncture.

It’s currently under resistance (blue line) that has already been tested.

At the end of the session today, we’re a Fibonacci 8-Days from the low set on May 25th.

If the index is going to reverse lower from here, this is a likely place to start.

Another attempt at resistance would indicate more upside pressure than anticipated; any existing short positions would be closed (not advice, not a recommendation).

Stay Tuned

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

Effort & Reward … Gold Miners

Lots of Volume … Little Progress

For the past two days Junior Miners GDXJ, launched higher on increased volume and then whacked itself right into resistance.

The daily chart shows the heavy up-volume, relatively wide price bars and then today’s decline (and new daily low) that took place with ease.

Wyckoff called this, ‘effort vs. reward’; lots of upward thrust (volume) that so far, can’t hold.

We’re about thirty minutes before the close and anything can happen; with that said, GDXJ is on track to close near the lows of the day.

Junior Miners GDXJ, Daily Candle

The ‘Inverse’ Clues

While the GDXJ, was declining with apparent ease, interesting things were happening with the leveraged inverse fund JDST.

That is, huge block trades were posted on the tape.

At least two blocks of 150,000 shares were observed scrolling on the tape within seconds of each other.

At the executed trade price, 150,000 shares represent a commitment of $972,000

Two of them is $1.94-million; a ‘modest’ position. 🙂

It should be noted that yesterday’s volume in JDST, was the second highest (edit … 4th, highest), ever.

In addition, those block trades mentioned above, took place in the middle of the day … highly unusual.

It all could be a ruse or for real. Either way, something big may be about to happen (not advice, not a recommendation).

Stay Tuned

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

Miners GDXJ, Tests 38% Retrace

Frustration Enough To Pull Your Hair Out

If it’s frustrating for the bears, it’s got to be frustrating for the bulls as well.

Pulling back and looking at GDXJ action without emotion, it’s clear we’re still in the ‘test’ (as we’ll see below) that’s been the topic of discussion over the past several updates.

The weekly chart of GDXJ, shows that even with today’s (as of 3:04 p.m., EST) retrace and test, we’re still in a negative divergence on the MACD (orange arrow).

Junior Miners GDXJ, Weekly

The horizontal blue line is not only an axis/resistance line, it’s also the Fibonacci 38.2% retrace of the GDXJ down move, April 13th, to May 25th.

We’re about an hour before the close and price action’s starting to erode from the highs.

If the downtrend is to continue, this may be a low-risk area for the shorts via JDST (not advice, not recommendation).

Stay Tuned

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