Miner Divergence

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Gold lost the 50 day MA on Wednesday which adds to the evidence that gold is declining into a daily cycle low. In this situation with gold down over 1% we would expect to see the Miners down as well.

Instead the Miners delivered a bullish divergence.

gdx

After peaking on day 5, the Miners printed its lowest point on Wednesday, day 13, printing a bullish engulfing candle. Now the Miners will be facing resistance from the convergence of the 10 Day MA, the 50 day MA & the declining trend line.

It is too early to expect a daily cycle low. However if the Miners regain the 10 day MA & the 50 day MA that would deliver a bullish surprise and we may be forced to recognize a shortened daily cycle low.

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