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GDX: Closing Below Support, Again

|Includes: VanEck Vectors Gold Miners ETF (GDX)

There was a sharp rally in the Market Vectors Daily Gold Miner ETF (NYSEARCA:GDX) at the open that was quickly reversed.

The GDX posted a lower low for the session and closed even with the prior session.

The Daily chart of GDX shows that there have been two successive closes below the support area of 23.50.

GDX Daily

Chart by TeleChart

This weights the probability to the downside..........However, there has not been a swift break of support and this weights to the up-side.

There are always two forces at work: The bullish side and bearish side. So, successive low closes give the nod to the bearish side while the lack of follow-through favors the bulls.

If the GDX opens gap-higher again at the next session, probability favors the bull side.

If the GDX high of 23.65 is exceeded, there may be a possibility of a rally and the position in the Direxion Daily gold Miner Bear 3X will be exited.

Since the SPDR Gold Trust (NYSEARCA:GLD) is trending lower and appears to be forecasting lower lows, a rally in GDX may not be sustainable.

If a rally begins to ensue, the correct action may be to let it pass depending on price action.

Disclosure: I am long DUST.