Gold's First Important Test Of Support Is Coming Up
Tim Knight | Jul 20, 2016 08:43AM ET
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:
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