Speculative Gold Stocks On The March?

AMEX ACRA Gold Miners Index (GDM)

Today’s Technically Precious missive is just a brief note to suggest that we may be close to a new bull move in gold stocks, primarily the speculative kind.  Nothing is yet set in stone but the initial indications are there.

The GDM chart shows an Index which has broken above its short term moving average line and although not shown, its short term momentum indicator has moved into its positive zone.  It is sitting right on its intermediate term moving average line and could break above very soon.  However, it may still be several days before the intermediate term average turns to the up side to confirm any intermediate term move.  The intermediate term momentum indicator in trending upward but is still in its negative zone not too far from its neutral line.

The intermediate term momentum indicator suggests that the momentum of the price action has continuously been improving in strength over the past 9 months, although still slightly negative.  This shows up in the price action as we have a positive divergence between it and the momentum at the two recent price low points.

A look at my short term point and figure chart suggests that the first of my two required indications for a trend reversal has occurred.  The Index price has broken above a short term pattern giving us a potential short term move to the 730 level, the high in October.  However, it still needs to break above its negative down trend line so it’s a gamble at this point.

Briefly, the suggestion here is that the GDM may just be preparing for a new bull move that is more than a short term one.  It’s not there yet but things are moving in that direction.

For those gamblers out there who may be following the DIREXION Daily Gold Miners Bull 3X ETF this could mean a short term move to the October high at the $60 level but first I would wait for it to breach the $32 level before acting.

A Look at my own two Indices, the speculative Merv’s Penny Arcade 50 Index is already on the move and this may be where the real profits may come from.

********

I welcome comments and/or suggestions.  I read them all although I may not have time to answer them all.  My email address is [email protected].