Two Signs That Confirm A Bearish Outlook

Two important factors that I have written about earlier only confirm the obvious for the precious metals: a bearish short-term outlook.

Today’s technical part of the analysis is going to be very brief, because of two reasons. First, very little happened during yesterday’s (Mar. 24) session. Second, what occurred simply confirmed what I had written earlier. There are two important things that happened yesterday, which can be considered signs. They both confirm the bearish outlook for the short term and they both indicate that our profitable short positions are likely to become much more profitable in the near future.

The first sign – just like yesterday – came from the mining stocks. Let’s start with a quote from yesterday’s comments on the 4-hour GDX ETF chart:

If you’ve been waiting for a high-quality sign that the next big move in the precious metals sector is underway – you just got it.

There are days on the markets when nothing happens, there are days when what happens is visible only to some (like Monday’s session), and there are days when the market’s signals are crystal-clear – as if the charts were practically screaming at the person examining them. Yesterday, was one of the latter kind of days.

Without further ado, let’s take a look at the key development that we just saw in the precious metals’ world – the big decline in the GDX ETF – proxy for mining stocks.

[NOTE: THE CHART BELOW IS JUST LIKE YOU SAW IT YESTERDAY]

ChartDescription automatically generated with medium confidence

After the tiny breakdown that I described yesterday (Mar. 24), the GDX ETF declined significantly, and it even opened the session with a price gap. If you look at the left side of the chart, you’ll see that this is the way in which the big January decline started. In the next 2 months, the value of the GDX ETF declined by over $8.

The reason that I left the chart without yesterday’s price changes is that I want you to be able to easily compare both of them and the changes that took place.

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Disclaimer: All essays, research, and information found on the Website represent the analyses and opinions of Mr. Radomski and Sunshine Profits' associates only. As such, it may prove wrong ...

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Erikas Ivan 2 weeks ago Member's comment

Thank you Mr. Radomski, I think I finally joined the right precious metal newsletter! Yes, that was a great call on the USDX's breakout verification recently, expecting a major PM decline next week as well.

Przemyslaw Radomski, CFA 2 weeks ago Author's comment

Thank you and welcome aboard!