But, the fundamental reasons to be invested in the gold stocks are as bullish as ever.<\/p>\n
The sector is likely headed much higher over the long-term. So, I’ve been anxiously waiting for a chance to aggressively buy back into positions.<\/p>\n
It still seems a bit too soon.<\/p>\n
Here’s an updated look at the Bullish Percent Index for the gold sector (BPGDM)<\/a> that we looked at last month…<\/p>\n <\/p>\n The BPGDM measures the percentage of gold stocks that are trading in a bullish technical formation.<\/p>\n It’s a gauge of overbought and oversold conditions. Since it’s measured as a percentage, a bullish percent index can only reach as high as 100% or fall as low as zero.<\/p>\n Typically, a sector is extremely overbought when its bullish percent index rallies above 80%. It’s extremely oversold when it drops below 30%. <\/p>\n The BPGDM has been stuck in neutral – at 53.57 – for the past three weeks. Similarly, shares of GDX were trading near $31 three weeks ago. And, they’re trading near that same level today.<\/p>\n As I mentioned last month, the BPGDM never reached 80 before it reversed lower in May. It never, technically<\/em>, generated a sell signal. So, it may not need to, technically<\/em>, generate a buy signal by declining below 30 before reversing higher.<\/p>\n But, the BPGDM still needs to work a bit lower before we can say that it’s “safe” to venture back into the gold sector.<\/p>\n <\/p>\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<\/p><\/div>\n<\/div>\n <\/p>\n Conditions are neither overbought nor oversold in the gold sector right now… Conditions are neutral.<\/p>\n The best time to buy gold stocks is when they are oversold, or at least approaching oversold levels.<\/p>\n So, the BPGDM needs to dip closer to 40, or perhaps 35, before I’m willing to add exposure to the gold sector.<\/p>\n Let’s keep an eye on the chart of BPGDM this week – especially after Wednesday’s FOMC announcement.<\/p>\n That announcement may provide the catalyst for another move lower in the gold stocks.<\/p>\n And, that move may finally create the sort of conditions that make it attractive to buy the gold stocks again.<\/p>\n Best regards and good trading,<\/p>\n Jeff Clark<\/p>\n <\/p>\n![\"Image\"](\"https:\/\/cdn.jeffclarktrader.com\/JMU\/images\/202306\/20230613-JMU-01_nkq411.png\")
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