Gold Miners Punished

The miners have not held up as well as hoped over the last few days.

While in the intermediate to long term they look to make new highs, short term things are beginning to look a little nasty.

While central banks continue to stockpile gold reserves, the bullion banks seem to still be successful with their raids on the precious metals markets which has spilled over into the miners.

The next week or so should give us a better idea if gold metal will consolidate before moving up, or reverse back down forming a possible double bottom prior to rallying.

It is looking like the miners have a lot of work cut out for them before my anticipated rally fully plays out.

The longer term MACD (25,170,25) has crossed below the signal line on all of these charts.

Even though Slow Stoch has a bullish cross on Golden Goliath, my favorite junior, there is a lot of resistance overhead and we have yet to see any serious divergence.

My earlier short term bullishness is now tempered significantly until the charts reflect some positive momentum.

While central banks continue their gold accumulation, miners have been hit by high costs for gold extraction.  It is simply a matter of time before the higher production expenses work their way up into the metal price as demand for precious metals soar as central banks and informed citizens alike hoard in light of the building crisis in the sovereign bond market .


  1. Afternoon PW. I have been looking over the charts, and well I think we may be in for a major reversal that is going to catch the shorts by the short hairs if you will. Maybe a nice end of the year rally is coming, the RSI on the S&P is the tell.

    Thinking DIA Jan Calls, what are your thoughts?

  2. Your DIA call idea looks good to me right now.
    The markets look quite oversold presently, yet the VIX remains subdued.
    So either the market totally falls out of bed and tanks as VIX skyrockets, or we get a hang on to your hat, fasten your seat belt rally into year end/early January.
    It's a tough call.


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