$GDX = Weekly Analysis = 19.06.2021 #gold #metals #investing #trading

Last week I mentioned $31 as a possible target and now it is very close. Two weeks ago $GDX formed Bearish Engulfing and now doubled down by completing a 10-week Tower Top. This formation suggest further decline. Let’s explore the hypothesis from different angles.

Monthly
Two trading days reversed the current monthly entirely. It is on it’s way to form a Bearish Engulfing. If it closes like this or lower, the $25 and $15 targets (that I also discussed last week) would become reality. Technical indicators support the southbound move.
Odds: Bearish

Weekly
Bearish Engulfing followed by Tower Top. It is difficult to think about more bearish combination of candles, especially on the weekly frame. From technical perspective, RSI moved back below 50, MACD on decline, PSAR flipped bearish on Friday, and price is solid below 8 EMA line. Not much to discuss – looking for a lower lows.
Odds: Strong Bearish

Daily
It looks like the daily candles moved down a bit too fast and it created an oversold condition. While candles point down, there is chance of a minor rally or horizontal development for several days, so that the indicators normalize. However, taking into consideration strong bearish pressure from the weekly candles, the daily candles could continue sharply down.
Odds: Bearish-Neutral

From previous weekly forecast “I am expecting a possible bullish action at the beginning of the week and the red candles closer to the end. Based on the minor waves, there is also a chance of an immediate move down. If the next week closes below 38.01 with a red candle, it would open a path to 31, 25, and even to 15, the most typical Fibonacci levels for corrective waves, as marked on the monthly chart. This would also mean that a multi-week/month decline is ahead.”

Forecast

There is chance of a minor rally or horizontal development for several days, so that the indicators normalize. However, taking into consideration strong bearish pressure from the weekly candles, the daily candles could continue sharply down. Targets – 31, 25, 15.
There are somewhat similar candle structures in gold spot and gold futures.

If there is a strong rally with at least two green candles closing above ~$37.00, there is a good chance that a bottom is in. Low probability at this point.

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