{"id":14770,"date":"2019-09-16T07:30:57","date_gmt":"2019-09-16T11:30:57","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=14770"},"modified":"2019-09-16T07:30:57","modified_gmt":"2019-09-16T11:30:57","slug":"here-comes-a-golden-bounce","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/here-comes-a-golden-bounce\/","title":{"rendered":"Here Comes a Golden Bounce"},"content":{"rendered":"

The gold sector is overdue for a short-term bounce. But, after that, there’s more downside ahead. <\/p>\n

Let me explain…<\/p>\n

Corrections in the gold sector typically unfold in three distinct “legs.” The first leg is a steep decline from the top. That’s what we’ve seen over the past week and a half. And, for reasons I’ll explain in a moment, that first decline phase should end soon – like today or tomorrow – and then be followed by the second “leg,” which is an oversold bounce off of support.<\/p>\n

Once that bounce ends, then we’ll get the third “leg” of the correction. That will be a deeper decline to an even lower low that exhausts the selling and eventually sets the stage for a new rally phase.<\/p>\n

Here’s an updated look at the chart of the VanEck Vectors Gold Miners Fund (GDX) I showed you right before the gold sector started selling off<\/a>. I’ve added some lines indicating my best “guess” as to how the rest of the decline will unfold…<\/p>\n

\"\"<\/p>\n

GDX broke its rising wedge pattern to the downside. And it sliced right through the first support level at $28. Now, the stock is approaching its second support level at about $26.25 or so. And the MACD<\/a> and CCI<\/a> indicators at the bottom of the chart have dipped into oversold territory.<\/p>\n

So, there’s a good chance we’re nearing the end of the first leg down. And, we’ll soon see a bounce in GDX back up towards its former support line, now resistance, near $28.<\/p>\n

The prospects of a bounce are supported by this 60-minute chart of GDX…<\/p>\n

\"\"<\/p>\n

This chart shows a falling wedge pattern with positive divergence on the MACD and RSI<\/a> indicators. This sort of setup often leads to a breakout to the upside. If that happens here, then GDX should be able to rally back up towards $28 or even $28.50 per share – which lines up nicely with the resistance line on the daily chart.<\/p>\n

Patterns on 60-minute charts tend to play out within four or five days. So, I expect we’ll see a bounce get started in GDX sometime early this week. <\/p>\n

Following that bounce, though, traders should be on the lookout for the third leg of the gold stock correction. As I said earlier… There’s more downside ahead for the sector.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

Today, a subscriber comments on Jeff’s Market Minute<\/em>…<\/p>\n

\n

The Market Minute<\/em> is so much of a boon to investors… Jeff is so precise and accurate with his technical analysis that I always look forward to receiving it. Please continue to send it to me.<\/p>\n

– Francis<\/strong><\/p>\n<\/blockquote>\n

Thank you, as always, for your thoughtful comments. We look forward to reading them every day. Keep them coming at feedback@jeffclarktrader.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

The gold sector is overdue for a short-term bounce…<\/p>\n","protected":false},"author":37,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-14770","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/14770","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/37"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=14770"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/14770\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=14770"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=14770"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=14770"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=14770"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=14770"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=14770"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=14770"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}