Miner Interest

The Junior Miners are starting to look interesting. They rallied over 20% on Monday and over 23% on Tuesday. They did form a daily swing low but still haven’t recovered their 10 day MA. There is a good chance that they will need to retest the Friday low. But there is the possibility that they won’t.

Drilling down to the 30 minute chart we can see that GDXJ began an uptrend on the 30 minute cycle band, dipped a bit then renewed the 30 minute uptrend. In order to avoid using Friday’s low as the stop, long positions can be entered using the 50 MA on the 30 minute chart as the stop.

The Miners Join The Party


 

The Junior Miners broke out of consolidation on Tuesday. The Miners joined the party on Wednesday.

The miners had been in a multi month consolidation since peaking in September. Over the past couple of weeks they were being squeezed by the declining 10 day MA and the rising 50 day MA. The Miners rallied on Tuesday then delivered bullish follow through on Wednesday by closing convincingly above the declining trend line. Closing above the declining trend line confirms that that day 55 was an extended DCL

After rallying strongly for the past three days the Miners got a bit stretched above the 10 day MA. They may need to crawl along the declining trend line in order to allow the 10 day MA to catch up to price. The Miners are in a daily uptrend and closing above the declining rend line should trigger a trending move.

Junior Miner Breakout

The Junior Miners broke out of their triangle consolidation on Tuesday.

The Junior Miners closed above the upper daily cycle band in early December to begin a new daily uptrend. After peaking early January, the Junior Miners have been consolidating by printing lower highs and higher lows. On Tuesday, the Junior Miners broke convincingly out of consolidation and closed back above the upper daily cycle band. This renews its daily uptrend and triggers a cycle band buy signal.

Miner Update

The Miners printed their lowest point on 10/15. The Miners finally closed above the 10 day MA on Thursday and delivered bullish follow through on Friday to signal that 10/15 was day daily cycle low.

But the Miner got a bit stretched above the 10 day MA and saw some profit taking on Monday and Tuesday, which allowed the 10 day MA to catch up to price. But the Miners closed for a gain on Tuesday. If the Miners deliver bullish flow though and form a swing low off of Tuesday’s candle, that will allow us to construct the daily cycle trend line.

And the Junior Miners also looked bullish on Tuesday.

Like the Miners, the Junior Miners saw some profit taking after tagging the 50 day MA. But where the Miners only closed higher, the Junior Miners printed a bullish engulfing candle signaling that the Juniors are ready to trend higher.

Major Opportunity

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The Miners have rallied over 17.00 % since the daily cycle low that printed on May 29th. Today they gapped higher, rallying for over 5% alone today and printing today’s candle above the Bollinger Band. So the Miners are getting overbought and are in need for a breather.

gdx bollingerhttp://postimg.org/image/lbkekszzr/

Below we can see that the True Strength Indicator has exceeded the level that has seen all other daily cycles turned back.

gdx tsihttp://postimg.org/image/6dgf6plnv/

This kind of pace is unsustainable. And the timing band for a daily cycle low only three days away …

gdx scenariohttp://postimg.org/image/hy4yaawkz/

A possible scenario is to see the Miners break higher again on Friday before reversing. Then a brief daily cycle decline that sees the Miners backtest the 200 day MA as it prints its daily cycle low before continuing higher.

While the Miners have been impressive, the Junior Miners have been better.

gdxj gdxhttp://postimg.org/image/9vsf33mjv/

Out of the December intermediate low, the Junior’s out gained the Miners 59% to 38%. And the current rally has the Juniors out gaining the Miners 34% to 17%.

The may be Junior Miners but they offer a Major Opportunity …

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