Just a quick update as mining stocks moved higher today and we received requests to comment on that before the closing bell.

In short, miners' performance is not that bullish as it may seem at the first sight. Miners were higher on an intraday basis yesterday, and they are not performing particularly strongly relative to gold, either.

The declining resistance line based on the previous two August highs (Aug 7 and Aug 18) was insignificantly breached in case of gold, but nothing like that happened in case of the GDX ETF. The latter are not yet ready to decline significantly at this very minute, but they are pausing, not rallying.

In our previous analyses, we wrote that both: gold and silver had triangle-vertex-based turning points early next week, and we wrote that if we see a rally before that time, they would likely imply a local top. Perhaps the final one for several weeks. Well, we have indeed seen a rally, so the above is now the most likely scenario. The same goes for invalidation of the small breakdown in case of the USD Index that we described in today's regular Gold & Silver Trading Alert.

So, all in all, the bearish outlook for the following weeks for the mining stocks (and the rest of the PM sector) remains up-to-date.

As always, we'll keep you - our subscribers - informed.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA
Editor-in-chief, Gold & Silver Fund Manager