The ARCA Gold BUGS index remains above support that dates back 10 years.
Over the past year and a half, the index has created a pennant pattern, a series of lower highs and high lows, teasing both the bulls and bears. As you can see, this pattern will soon be coming to an end.
Pennant patterns are popular for suggesting that a large move is ahead, yet which direction is a different story. This pattern does fall under the continuation of trend category, although anything is possible.
After years of disappointment, bullish miner investors should be treated to a bit of upside action if the pattern breaks out to the upside. The best plan for a pennant most often is to sit back and watch for the breakout and then follow it.
Based on this pattern, it appears that investors won't have to wait long for the outcome.