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Thursday, November 20, 2014

GDXJ's status and what I think will move it


Here's GDXJ:


For what it's worth, even after all of yesterday's shenanigans, it's still not broken down below the EMA(9) yet.

And, again, this is what I think will move it:


US dollar needs to shit or get off the pot.

If USD moves up again, that'll mean more white-ass hedgie crackers going long-USD-short-gold and more long-USD-short-miners, and thus more pain for the GDX and GDXJ as the short sales pile in and swamp out the underlying market for shitty gold miners.

If USD is done moving up, which FFS you'd think it has to be eventually because the US market has been doing a great job recently of moving into things too fast too early and this was a heck of a move, then the shorts get closed out and we can move back to reality, grim as it may be.

I don't see how the USD can sustainably move up against JPY during a Japanese election, and I don't see how it can sustainably move up against the Euro because the hopes for a Draghi QE are far ahead of the German jackboot of European fiscal reality. But I guess I'm open to be proven wrong.


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