Intraday Gold Trading Alert #2

Nov. 14, 2024

Briefly: We no longer feature a short position in mining stocks or gold (or silver) at this time.

I think that a small (50% of the regular position size) long position in the GDX (not GDXJ) is currently justified from the risk-to-reward point of view.

Some might consider an additional (short) position in the FCX.

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In addition to the points that I made earlier today, I’d like to add one more.

Namely, mining stocks are holding up strongly compared to what we saw in gold. GLD is down by about 0.5%, while GDXJ is up by about 0.1%. That’s not much, but the fact that miners managed to move higher at all despite weakness in gold and in the general stock market has bullish implications.

Remember GDXJ’s link to 2022 and the decline that we saw that year? Back then, the initial slide was bigger than what we see now, but it also took four weeks. It is said that time is more important than price, so we might see a corrective upswing based on this analogy as well.

Additionally, the GDX (not GDXJ) moved to a 200-day moving average (precisely) and almost touched its 50% Fibonacci retracement based on the entire 2024 rally (yes, miners recently erased almost half of this year’s rally). Both are important support levels.

Consequently, we are closing the short position in the JNUG / GDXJ right now, even though it hasn’t reached our downside target levels yet.

We’ll be back on the short side of this trade soon – perhaps in the next three – ten trading days.

For now, I think that a small (50% of the regular position size) long position in the GDX ETF (not GDXJ) is justified from the risk-to-reward point of view.

How high can the GDX rally here? My current best estimate is at about $38.5, but I’ll update this target as we move closer to it.

I’ll keep my eyes open, and I’ll report to you – my subscribers – accordingly.

Thank you.

Przemyslaw K. Radomski, CFA

Founder, Editor-in-chief

P.S. In case of questions, please contact our support - they will either help immediately or forward your message to me.