The weekly GDX did not confirm a bottom. Instead, it formed another doji that signals indecision. The daily formation is more optimistic. Let’s explore the hypothesis from different angles.
From previous weekly:
The next week (at least the beginning) is expected to be moderately bullish.
– If GDX closes next Friday above $35.18, the odds would shift to the bulls side.
– If GDX closes below, a good chance for continued downwards move.
GDX is operating under the Bearish Engulfing of June. The damage is done on the monthly scale and the odds have shifted to the dark side. While there is a chance of a short-term rally, the price is expected to revert back closer to the end of month.
A first sign of recovery would be a July closure above ~$37.
This weekly candle, another Doji, did not set a direction, postponing the decision for at least one more week:
– next week closure above $35 would signal a bottom in place;
– a closure below $33.40 would mean a continued decline.
The technical indicators continue to drift down: MACD and RSI don’t show the signs of recovery yet. On top of that, the bearish weekly 8/20 EMA cross.
Friday’s candle formed a Bullish Harami combo that is considered quite strong and could be the beginning of a rally. The price just climbed over the 8 EMA line and the minor waves show a good chance for a rally towards $36 or higher.
The red rectangle shows the inflection area. A strong break upwards would mean a bottom in place. If rejected, the red count would be the likely one.
Last week I suggested that it would take 1-2 weeks for GDX to hit the rectangle. So far, this forecast stays.
The first part of the next week is expected to be moderately bullish with the target of ~$36. The second part needs to be watched closely for a possible reversal down.
– If GDX closes next week above $35, this would signal a bottom in place.
– If GDX closes below $33.40, a continued decline would be highly likely.
GDX continues to be under a strong bearish pressure on the weekly and a significant effort would be required to overcome this. The monthly closure above $37 would be the first step.
The long term targets continue to be the same, as I identified several weeks ago – $31, $25, $15, until I see a strong bullish move on the weekly/monthly frames that would recover the long-term damage.
The detailed previous Monthly and Weekly analyses with forecast can be found by the links below.
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Previous Monthly & Weekly: