GDX managed to hurdle over a resistance line that I thought would give it some serious pause. There are two charts below – one zoomed out and one zoomed in with a relatively more recent trend line.
The above chart has the Fib retracement lines from the 2008 lows to the 2011 peak. The $26.31 level is what GDX hopped over today. Score 1 for PM bulls.
Zoomed in, the following chart shows the declining trend line that GDX bumped up against almost perfectly today (maybe over by a penny or two). The trend line does have a caveat associated with it and that is highlighted in yellow. If we keep the candles in the yellow box under the trend line, then the line would intersect the GDX price axis at ~$30.
Today, GDX rose in the only way it could really have risen, which is to pole vault over the $26.31 Fib line. Will it do the same to the declining trend line? We will know very quickly if GDX is headed back down or whether it will pole vault over one resistance line after another.
Cross-posted at http://protectedreturns.blogspot.com/ and included in the Nightly Report at http://www.protectedreturns.com/.
