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GDX/GLD Ratio Should Produce A Bullish Divergence
By: Tim Ord | September 15, 2017

• SPX Monitoring purposes; Short SPX on 8/30/17 at 2457.59
• Monitoring purposes Gold: Neutral
• Long Term Trend monitor purposes: Neutral



The pattern forming on GDX appears to be a bullish Head and Shoulders bottom where the July low was the Head. A “Sign of Strength” through the Neckline was present and helps confirm the Head and Shoulders pattern. A pull back to the breakout area (Neckline) near 23.25 range is normal before market heads higher. If the 23.25 range is going to be support the GDX/GLD ratio should produce a bullish divergence and something we will be watching for. Today GDX tested its late August low and closed above, where GDX/GLD ratio closed below its late August low Showing GDX/GLD ratio is weaker than GDX and a bearish sign for GDX. For a bullish develop to occur, GDX/GLD ratio should start to outperform GDX and when that occurs a bottom may not be far off. A bullish setup could develop near 23.25 on GDX if GDX/GLD ratio starts to outperform GDX. Still neutral for now.”

http://www.talkmarkets.com/content/us-markets/gdxgld-ratio-should-produce-a-bullish-divergence?post=149368

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