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Tactical Technician
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I struggle daily with not letting my own thought processes get in the way of technical analysis, but I believe if we are going to follow the markets technically, we should devote ourselves to following them in a strict, technical manner and steer clear of sites or writers who can only add to our... More
  • Gold And The GDX: A (Misguided) Technical Theory 0 comments
    Nov 20, 2013 7:19 PM | about stocks: GDX, GLD

    The stock market is, if nothing else, a roller coaster ride, particularly for those of us who follow its daily swings.

    A move in one direction or another and it sends either the bulls or bears off seeking the next great shift in momentum.

    Searching for a bottom or top can be an undertaking in temptation: It tugs at our hearts and can (often) lure us into misguided decisions.

    I, myself, tend to stick with a few charts and indexes.

    I basically track gold and the GDX (mining stocks), and the main stock market indexes (the S&P 500, the Dow and the Nasdaq). The reasons behind my preferences are simple: Volume is consistent and I don't have to devote a lot of time pouring over individual stock performance.

    Which leads me to gold and the GDX.

    There is no upward momentum. Those who tell you (or have told you) differently are not looking at charts, they are looking at fundamentals, which, admittedly, I don't follow.

    What I did say, on November 10th is that $1215.40 is a critical number, not only for gold, but the stocks that make up the GDX.

    I have to say, I will be quite surprised if gold doesn't find that level.

    I will also be surprised if we don't see new lows on the GDX.

    There are all kinds of writers on this site who oppose these ideas.

    And that's what I love about the markets.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: GDX, GLD
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