It look like gold mining shares are under perform comparing with gold price. Will there be catch up with gold price? If you think there will be than there are good profit to be make on gold funds.
The chart that no one has picked up yet -- but everyone will be saying it in a day or two if we rally.
One of the big concerns has been the pattern the HUI and the 2008 "set-up" that was going on. We discussed we were on strike one on the gold stocks button and we were watching the key bull/bear line that we've had as our point in the sand as to whether the "set up" pattern was going to escalate lower. WHILE THE STOCK MARKET TANKED -- THE GOLD DID NOT -- suggesting the major support has held for the time being.
In this cycle of higher degree, we have a most unusual chart pattern. The market is showing a canceling of the down "set-up" and has now put in a reverse head and shoulder with an UPSIDE SET UP. LOOK now as we have a reverse head and shoulder set up.
The low came in right where we needed it, at the Major Bull/Bear Zone. This line has been on our chart for over a year and has been our line in the sand over and over again.
The rally moved exactly right back up to the key UPTREND channel line at 550. A CLOSE ABOVE THE CHANNEL LINE AND THE MOVING AVERAGES could be signaling the gold stocks are putting in a MAJOR bottom and the North American seasonal rally is about to begin. It's the right time for the seasonal as well. Thus we now have a strike one IF WE CAN NOW ENTER THE CHANNEL line and have price turn above the moving averages. This is a huge development. Continue to use the bull/bear zone as your bottom line in trading the gold stocks. Even Medium AND LONG term investors need to keep this 470-520 area in mind as it IS THE MEDIUM TERM MAJOR SUPPORT point. Now if we can get above the channel and averages --- we get strike two to the upside. Let's see what she does.
DOLLAR--- The dollar remains in a 3 year trading range. The final support line is the key on the downside and the34 week moving averages on the upside. The trend remains down
