Just a quick update as things got quite hot today, so I thought that you’d appreciate an update before tomorrow’s regular analysis.

Remember what happened in January 2020? Crude oil broke above its previous high on an intraday basis and then declined, more than erasing the upswing. That’s exactly what we saw today. The Jan 8, 2020 decline was more dramatic, but today’s slide is very visible too.

Remember what happened in the USD Index at the beginning of 2020? It rallied and then continued to rally for several more weeks. Afterwards, things got turbulent, but the index managed to soar to almost 104 in less than 4 months, starting the year at about 97.

Gold is strongly up today, but the same was the case in the first days of 2020 - it topped on Jan 7, 2020 - just a day away from crude oil’s key daily reversal.

And miners? Sure, they are up today, but they just rallied to the 61.8% Fibonacci retracement based on the Nov 2020 decline - a classic retracement. For a comparison, gold moved very close to the November high. In other words, gold miners continue to underperform, even though today’s session doesn’t seem anything like it.

All the above, plus the two triangle-vertex-based reversals that we see in both: gold and silver, make me think that today’s upswing is not here to stay. Conversely, it seems to be something of only a temporary duration and implications.

The GDX ETF remains below the November 2020 lows, which were below the September lows, which in turn were below the August lows. Over the medium term, it seems that miners are posting lower highs and lower lows - that’s a downtrend.

Consequently, the bearish outlook for the next several weeks to months remains up-to-date.

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

Thank you.

Sincerely,
Przemyslaw Radomski, CFA
Founder, Editor-in-chief