Scott doesn’t think the Gold Trade is done just yet.. $GLD $GDX $AEM $NEM $WPM $FNV – March 3, 2022
GDX GLD AEM NEM WPM FNV
This is Scott with your Chart of the Day. I personally don’t think the gold trade is over just yet. I did sell some gold, GDX ( NYSEARCA: GDX ), on this day here, where we had a big downside reversal coming on high volume. But ever since then GDX ( NYSEARCA: GDX ), as you see, has been creeping higher and we are back to the highs here. So a definite change in character from what could have been the start of a new downtrend.
Usually, if you get a big downside candle like this it’s over, you have got to go. But gold and GDX ( NYSEARCA: GDX ) is kind of breaking some expectations. And so I ended up re-buying my GDX ( NYSEARCA: GDX ) on this day and I added a little today into the close because I like the fact that it is able to recover and, again, break my expectations to the upside and make me buyback.
That is one thing that you have to do, I think, especially in this market. You have to have that flexible mindset. Just because you sold something a day or two ago doesn’t mean that you can’t look for another entry because this market is wild, it is anything but orderly. And so I am finding a lot of success in leaning into trends that break my expectation to the upside and gold is one of them.
If I look at GLD ( NYSEARCA: GLD ) here, zoom out, you can see it. It came out of this nice downward sloping trendline and now we are building a kind of a shorter downward sloping trendline, a little bit of a flag formation here, and again, close to the highs, so I don’t think gold is done.
Let’s look at AEM ( NYSE: AEM ), still okay. For the most part, above all the major moving averages. NEM, Newmont ( NYSE: NEM ), close to the highs, actually made a new high here today. Wheaton Precious Metals ( NYSE: WPM ), again, really nice and tight here, above all the major moving averages. Franco-Nevada ( NYSE: FNV ), is close to the highs.
So I think you really want to keep an eye on and lean into some of the sectors that are working in this market and gold and the gold miners are one of those sectors.
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