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Gold's First Important Test Of Support Is Coming Up

Published 07/20/2016, 08:43 AM
Updated 07/09/2023, 06:31 AM

Those of you who watch my little Tastytrade show might remember that yesterday I turned sour on precious metals miners. I bought a position in Direxion Daily Gold Miners Bear 3X Shares (NYSE:DUST) and also shorted a couple of specific miners—First Majestic Silver Corp (NYSE:AG) and Newmont Mining Corporation (NYSE:NEM).

Philosophically, I’m a big fan of precious metals thriving in the years ahead as a declaration of the ultimate failure of central bankers. From a charting perspective, though, miners have been oh-my-Lord-overbought for weeks now, and it seemed it was time for a breather (what really sold me was the collapsing volume in DUST, suggesting people had just stopped bothering anymore).

In any event, it looks like this sector is in for some backing-and-filling. Gold’s first important test of support is coming up, tinted in green:

Gold Price Chart

Latest comments

nice call mate,, Looks like its hit 1310 and bounced off with plenty of guts// be interesting to see if it pulls back around 1325 50%fib or busts through.. I guess a lot depends on the ECB future policy outlook in an hour or so.
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