Based on yesterday's price moves, once again nothing changed. Precious metals and mining stocks moved lower, but neither gold, nor mining stocks invalidated their breakouts above short-term support lines. It seems that the declining resistance lines ($1,250 for gold and either 215 for the HUI or $22.20 for the GDX) will be reached before the sector declines again.
The USD Index moved close to its November 2013 high but gold didn't decline significantly, which is a sign of strength (a short-term one only, though), which further supports the above-mentioned outlook.
Consequently, the summary of today's alert is similar to the one that we sent yesterday. We suggest being out of the market with the speculative capital right now and preparing to re-enter the short positions in the precious metals sector. We will let you know when we think it's a good idea to open these positions. For now, it seems that it will be when gold is closer to $1,250 and the HUI to 215.
Naturally, we will provide you with a detailed analysis and charts in tomorrow's Premium Update.
To summarize:
- Trading capital: No positions.
- Long-term capital: No positions.
As always, we'll keep you - our subscribers - updated should our views on the market change. We will continue to send out Market Alerts on a daily basis (except when Premium Updates are posted) and we will send additional Market Alerts whenever appropriate.
The trading position presented above is the netted version of positions based on subjective signals from your Editor, and the automated tools (SP Indicators and the upcoming self-similarity-based tool). You will find more information by following links in the summary of the latest Premium Update.
As a reminder, Market Alerts are posted before or on each trading day (we usually post them before the opening bell, but we don't promise doing that each day). If there's anything urgent, we will send you an additional small alert before posting the main one.
Thank you.
Sincerely,
Przemyslaw Radomski, CFA
