Stansberry NewsWire: Gold stocks are reaching an important inflection point
From Greg Diamond, Analyst, Stansberry NewsWire:
Today, I’m looking at gold miners, as measured by the VanEck Vectors Gold Miners Fund (GDX).
As we can see in the following chart, prices are approaching critical levels of support (the blue line). This represents a 61.8% “retracement” level from its lows in December 2016. In the past, GDX shares have bounced off this level, which usually comes into play during the corrective phase of a stock in an uptrend.
One technical observation that many people aren’t familiar with is the power of the fourth inflection point regarding support or resistance…
Whenever you see prices reaching a level (in this case, support) for the fourth time, it’s worth noting. While prices aren’t there just yet, GDX is fast approaching support again. The fourth inflection point tends to be significant, so it’s no surprise to see this level in play today, following the Federal Reserve’s latest meeting.
Keep your stop losses tight going forward. If GDX breaks below this level, we may see last December’s lows in play.
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