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If This Breaks, Watch The Gold Miners

Published 07/02/2014, 03:29 PM
Updated 07/09/2023, 06:31 AM

The NYSE Vs. Jr. Gold Miners ETF

This ratio compares the NYSE Composite Index to the Market Vectors Junior Gold Miners (ARCA:GDXJ). When the ratio is moving higher the NYSE is reflecting relative strength to the small mining stocks. Over the last year the ratio has stayed with a uniform rising channel.

Testing Support

At this time the ratio is testing rising channel support and may have created a bearish head-and-shoulders topping pattern.

We also have to look at it this way -- Support for this ratio is at hand!

If, in fact, the ratio breaks below rising channel support, the message should be bullish for mining stocks.

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