Tuesday, December 9, 2014

The fun collapse began in September, remember

Here's the thing:

The wild collapse in miners began in September. If that lunatic theory of mine is correct, then September is when everyone started to pile into a long-USD short-gold trade. And it worked for them for a while.

If just half of that trade has to unwind now, maybe GDX gets back to 23?

I'm not predicting that it does. I'm just going to keep that number in my head as a possible target, to ensure I don't sell too soon.

People seem to be selling miners and PMs hard into this move (and who can blame them! I mean, look at how brutal the market has been!), so I expect even if we have our magical new uptrend that there'll be a lot of backfilling. Heck, maybe gold has to spend a whole month diddling around at the SMA(50).

Maybe it even fails.

At least I bought my stuff at a good point, so I will still have green in my summaries even if this move fails and I sell to limit losses.

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