Gold Miners ETF (GDX)

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The Ord Oracle: GDX Update
By: Markets & Mayhem | April 6, 2022

SPX Monitoring Purposes: Long SPX on 3/25/22 at 4543.06.

Monitoring Purposes GOLD: Long GDX on 10/9/20 at 40.78.

Long-Term SPX Monitor Purposes: Neutral.



The second window down from the top is the Inflation/Deflation ratio. When this ratio is rising, it's a bullish sign for gold and gold stocks; when declining, it is a bearish sign. Right now, this ratio is testing May 2020 and not backing away from that high, suggesting this ratio is "eating through" supply and, once supply is exhausted, should move higher, taking gold and gold stocks with it. The next window down is the XAU (which is home to more of the high-tier major gold stock) and it, too, is at its previous high and not backing away, building "Cause" (energy) to push through resistance. Notice that GDX is not at its previous high (which is home to lesser-tier stocks), showing that the higher-tier stocks are leading the way higher. This happens early in the bull phase of the rally. When the lesser-tier stocks are leading the way (meaning speculation), its getting late in the bull phase. The sideways consolidation in GDX and XAU has been going on for nearly a month; time is about up for the consolidation to end and the Impulse wave to start. A clue that the impulse wave has started will be when the ratio breaks to new highs.

Tim Ord,

Editor

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