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Robert Edwards
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Contrarian daytrading technician who specializes in locating high probability short term trades while predicting price movement directions with over 85% accuracy. Most of my trading involves either extremely short term micro scalping of stocks or commodities (using 1 minute bar charts), or swing... More
  • Gold Miners (GDX) Continue Weak, Weaker And Weakest...Bottom Is Near! 1 comment
    Apr 17, 2013 8:43 PM | about stocks: GDX, NUGT

    On 4/04/13 I wrote an article seekingalpha.com/instablog/6143431-robert-edwards/1721631-gold-miners-gdx-continue-weak-bottom-is-not-yet stating that the gold miners continue weak and the bottom is not yet. Well, I am now going out on the limb to say a bottom, even if it is not "the bottom" is about to be found.

    I recently posted an article predicting a move in DUST (the triple leveraged inverse ETF) from the low 50s to 80. Well, it hit that target and has continued all the way to 104 and today just a few cents shy of 120. The miners are falling over twice as fast as the metal. The gold metal has crashed so that means the miners have crashed times two. So if the gold metal is oversold.....the miners are oversold times two as well. Surely the bottom is near for a small rally. Today's low in GDX was 27.38 which is similar to the historic low that GDX hit back in September 2008 when it bottomed at 26.75 before rallying back to 37.88 a couple weeks later. A month later it bottomed at 15.48 before hitting 37 again 4 months later. Just like in 2008, we are trading in the miners like the economy is facing a crisis. In 2008 the fears were founded and even then, GDX was able to bounce 11 dollars off the 26.75 low before making the ultimate low of 15.48. I expect a similar bounce now even if a great selloff is still coming down the road. A 41% rally is a very trade-able bounce.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in NUGT over the next 72 hours.

    Stocks: GDX, NUGT
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  • Robert Edwards
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    Author’s reply » I was calling for a 41% bounce and Barrons is also now looking for a 40% rally as mentioned in the April 21, 2013 issue.
    22 Apr 2013, 11:05 PM Reply Like
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