GDXJ GDX Gold Mining Stocks Downtrend – High Odds Technical Set-Up For Vicious Sell-Off

by Olivier on July 8, 2015

Gold miners look extremely weak here. The overall technical picture is very bearish. This is no surprise at all for those who read my website on a regular basis. The last time I wrote about Gold my highest odds proposition was for GLD to undercut the 100$ level.

In that post I used the same adage I used in my GDXJ chart annotation:

In downtrends you either short or you stand aside.

It’s really as simple as that. Forget your ego, face reality. As a trader I am not interested in being right, I am only interested in making money. Therefore my focus is on technical analysis and analyzing price charts. Everything else is noise. My job is to get rid of all distractions and to be objective.

That said, GDXJ – Junior Gold Miners ETF looks very bearish right now. If the technical picture doesn’t change significantly, the highest odds proposition is for a vicious sell-off to materialize sometime during this summer. We haven’t seen any kind of volume blow-off that would indicate capitulation. Until we don’t see that capitulation I remain bearish for the precious metals. Although I have tried to go long on a few rare occasions, RIC – Richmont Mines comes to mind, I have been predominantly bearish for several years now. I have advised to stay aside many times saying it was too early to get bullish. If you missed them, check my Past Interviews to see what I am talking about.

Click on GDXJ – Junior Gold Mining ETF chart to enlarge:

GDXJ Junior Gold Miners Mining Stocks Bearish Downtrend Technical Analysis Price Chart Target

If we get more downside confirmation i.e. if the support level indicated by the black horizontal lines finally is breached, then the downtrend channel in blue is indeed the dominant pattern. This would imply a vicious plunge towards the lower trendline of the channel in the next 2-3 months.

Conclusion: Do not try to be ‘smart’. Do not try to pick bottoms. Listen to the charts.

Sometimes you win by not losing.


Investing in your education always pays. Learn how to read chart patterns like a pro! Tischendorf Letter Premium:

Previous post:

Next post: