Chart of the Week: GDX

GDX is showing both bullish and bearish price action.

GDX reversed off of the 0.5 retracement level from the impulse move up from March 20 to August 20. A reversal at the 0.5 is considered bullish and a buying opportunity. However, I believe there is clearer evidence of a bearish move. A head and shoulders pattern formed in white. GDX looks to of formed a topping pattern. We can forecast targets by taking the height of the head to neckline under the neckline as shown in white. GDX also may of just finished leg B of the ABC move down. The 1 to 1 retracement of leg A and B puts the end of the C wave at around $21-22 the same expected target for the head and shoulders. Starting of with a small short position.

GDX moves in turn with EEM and TIPS ( Treasury Inflation Protected), I am expecting eventual downward moves in these also.

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Bulls can also attach a pitchfork to this graph

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If 37 is broken bear case goes out the window.

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If it does not double top at 37, next target is 39.

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If you are looking to buy GDX it will surely be at 34 in the coming weeks. I am still bearish on GDX fundamentally. No position. just watching

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shorting now

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It is risky shorting now, start off with a really small position. Wait for confirmation to add