{"id":19717,"date":"2022-05-12T07:30:10","date_gmt":"2022-05-12T11:30:10","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=19717"},"modified":"2022-05-12T07:30:10","modified_gmt":"2022-05-12T11:30:10","slug":"this-sector-is-ripe-for-an-oversold-bounce","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/this-sector-is-ripe-for-an-oversold-bounce\/","title":{"rendered":"This Sector Is Ripe for an Oversold Bounce"},"content":{"rendered":"

We’ve been cautious about the gold sector here in Market Minute<\/em> for the past couple of months.<\/p>\n

Within just the past few weeks alone, gold stocks have fallen hard.<\/p>\n

But now it’s time to start getting back in.<\/p>\n

The VanEck Vectors Gold Miners Fund (GDX) traded as high as $41 per share in early April. But on Tuesday, it closed below $32 per share – a 22% drop in about one month.<\/p>\n

That decline wiped out all the gold sector’s gains for 2022. And it shifted the technical condition from “extremely overbought” to “extremely oversold.”<\/p>\n

This comes as no surprise…<\/p>\n

In March<\/a>, we pointed out that the “smart money” had turned bearish<\/a> on gold.<\/p>\n

And in early April<\/a>, we noted that the GDX\/GOLD ratio chart had reached an extremely overbought level.<\/p>\n

So, we figured traders might have a better chance to buy into the gold sector later.<\/p>\n

Now, after a sharp decline in the gold stocks over the past few weeks, we may finally have our chance.<\/p>\n

Take a look at the GDX chart…<\/p>\n

<\/p>\n

\"chart\"<\/p>\n

(Click here to expand image)<\/a><\/p>\n

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GDX rarely strays more than 8% away from its 50-day moving average<\/a> (MA – blue line) before it reverses back toward the line.<\/p>\n

In early March, GDX traded as much as 20% above its 50-day MA. It was overbought, and vulnerable to a decline.<\/p>\n

<\/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

<\/p>\n

Today, GDX trades about 13% below its 50-day MA. It’s oversold, and we could see a “snap-back” rally start at any time.<\/p>\n

Of course, there aren’t any guarantees in trading. Oversold conditions can always get even more oversold.<\/p>\n

But based on my analysis, I believe the sector will trade much higher in the coming months.<\/p>\n

So, if you were looking to buy into the gold sector anytime within the past two months – and you held off because of our warnings – you now have a much better opportunity to buy the gold stocks.<\/p>\n

Best regards and good trading,<\/p>\n\n\n
\"signature\"<\/td>\n<\/tr>\n<\/table>\n

Jeff Clark<\/p>\n

<\/p>\n

Reader Mailbag<\/h2>\n

Have you been holding off on buying gold stocks? Will you buy into it now?<\/p>\n

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Conditions have shifted and now\u2019s our chance. <\/p>\n","protected":false},"author":55,"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-19717","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19717","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\/55"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=19717"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19717\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=19717"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=19717"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=19717"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=19717"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=19717"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=19717"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=19717"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}