{"id":19423,"date":"2022-02-16T07:30:22","date_gmt":"2022-02-16T12:30:22","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=19423"},"modified":"2022-02-16T07:30:22","modified_gmt":"2022-02-16T12:30:22","slug":"all-signs-point-to-a-monster-move","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/all-signs-point-to-a-monster-move\/","title":{"rendered":"All Signs Point to a Monster Move"},"content":{"rendered":"

Two weeks ago<\/a>, I wrote about the dollar setting up for a sharp selloff.<\/p>\n

Since then, the U.S. dollar index (DXY) – which tracks the buck’s performance against a basket of other currencies – has declined by as much as 2.36%.<\/p>\n

This recent weakness in the dollar means that one of my favorite markets is now setting up for an exciting bullish<\/a> breakout.<\/p>\n

I’m talking about gold…<\/p>\n

Gold and the U.S. dollar have an interesting relationship. While the value of the dollar isn’t the only factor that influences the price of gold, it’s an important variable.<\/p>\n

Historically, the dollar and gold tend to move in opposite directions.<\/p>\n

When the dollar falls, gold goes up. And when the dollar rises in value, gold prices tend to drop.<\/p>\n

That’s why I keep a close eye on what the DXY is doing. If the DXY looks like it’s about to have a big move, then I’ll look at the gold market to see if it’s ready to trade in the opposite direction.<\/p>\n

So, today we’re going to check out a weekly price chart of one of my favorite gold stocks, the VanEck Gold Miners ETF (GDX), to see if this is the case.<\/p>\n

As Jeff Clark wrote last Thursday, gold futures are trading in a consolidating triangle pattern.<\/a><\/p>\n

When this pattern completes, it almost always results in a big burst of energy.<\/p>\n

And now, GDX has broken out of its own pattern.<\/p>\n

Based on the current setup, GDX is setting up for one monster of a move.<\/p>\n

Let’s take a look…<\/p>\n

\"Chart\"<\/div>\n

I’ve drawn this pattern using blue trend lines. Old-school technical analysts call it a falling wedge.<\/p>\n

A telltale sign of a falling wedge is when both trendlines are pointing in the same direction.<\/p>\n

The deeper the prices trade within the wedge, the narrower the space between the lines becomes – increasing the odds that a breakout is going to happen.<\/p>\n\n\n\n
\n

Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

I’ve also included a 200-day moving average<\/a> (MA – red line). This MA should serve as strong technical support<\/a>.<\/p>\n

If we put all of this technical evidence together, I believe there’s a strong case for what would be a long overdue rally in gold and gold stocks.<\/p>\n

So, let’s quickly recap that evidence…<\/p>\n

    \n
  1. \n

    The U.S. dollar is breaking down.<\/p>\n<\/li>\n

  2. \n

    Gold futures are close to breaking out of a year-long triangle pattern.<\/p>\n<\/li>\n

  3. \n

    GDX has just broken out of a year-long falling wedge pattern.<\/p>\n<\/li>\n<\/ol>\n

    These factors set the stage for great trading opportunities in gold and gold stocks.<\/p>\n

    And if I’m right, it’s going to be one monster of a move…<\/p>\n

    Happy trading,<\/p>\n

    Imre Gams
    Analyst, Market Minute<\/em><\/p>\n

    <\/p>\n

    Reader Mailbag<\/h2>\n

    Where do you think gold and gold stocks will head next?<\/p>\n

    Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n

    <\/p>\n","protected":false},"excerpt":{"rendered":"

    These two things have a fascinating relationship…<\/p>\n","protected":false},"author":49,"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":[76],"newsletter-type":[],"ticker":[],"class_list":["post-19423","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-imre-gams"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19423","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\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=19423"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19423\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=19423"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=19423"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=19423"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=19423"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=19423"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=19423"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=19423"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}