Wednesday, July 14, 2010

Minor (Miner) Summer Doldrums Are Here Again?

*
Little by little I am going to learn about the Gold/GDX cycles and if you like, you can watch me in my 'discovery' process.
*
This first daily chart is of GDX - the miners.  It is primarily a look back at last summer 2009.  Using the True Strength Index (TSI) indicator as a guide, I attempted to decipher and dissect the daily cycles. 
*
Three simple observations.  
1. The daily cycles appear to me to be somewhere around 36 to 42 days. 
2. The summer months are BORING with a small range of only 6 points.  Kinda difficult to trade your way to riches with that doldrum action.  
3. GDX maintained a nice upward sloping trend line.
*
Click on the chart to ENLARGE
*
This second daily chart of GDX brings us up to our current date.  Again, I have attempted to figure out the daily cycles and identify their location, guided by the TSI indicator.
*
Well, we observe GDX again obeying a nicely rising uptrend.  And it appears that the intra day range, so far, is a mere 7 points.  Perhaps we are near the bottom end of that 7 point range right now.
*
Whereas the first chart identified daily cycles in the range of 36 to 42 days, this chart has a couple cycles within range at 34 and 40 days, but the currently completed (?) daily cycle, at 30 days, seems curiously short.
*
So again, I cannot help but wonder if we drop down one more time......creating a cycle that is within the "normal" range of 36 to 42 days.   Today, Wednesday, would be day 35 by my count.  I imagine we should have our answer by the end of this week.  If we were to drop down one more time, that would present a rather low risk entry point considering the summer doldrum range and the completion of a "normal" daily cycle.
*
I am going to be on the road ALL DAY Thursday.... but hope to be back online Friday.


Click on the chart to ENLARGE

No comments:

Post a Comment