Take a look at how GDX performed last Dec '09 - Feb '10. That was a time period in which a lengthy weekly cycle was coming to a conclusion and final bottom. Do you see the BEAR Flag I marked? Does it look similiar to the situation we are in now?
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And notice how GDX behaved when the BEAR Flag broke in early January. It did NOT stop falling until it landed on the C wave uptrend line. I need say no more.
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Some nice folks have been asking me why, if I think gold and the miners are not done going down, why do I not sell everything now and buy it back later.
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I know my answer will not make sense to most folks, but here it is: I am sick and tired of losing money. I've learned my lessons the hard way - by losing money.
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And I 'KNOW' that if I just sit still with the majority of my positions, and practice some patience, I am going to make a small killing this Fall.
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Frankly, I would rather suffer another 10% drawdown right now and hold what I know is going to pay off, than try to get so tricky trading that the only one fooled is me.
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Click on the chart to ENLARGE
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My analysis also points to 44-45 as the low, but I bought some today just in case it doesn't get there. I also learned the hard way not to sell out all of my PM positions. I will keep a core position of about 1/3 of my trading capital in the PM stocks until we see the parabolic move at the end of the bull market. I swing trade another third and day trade the final third, something for everyone. I'm mostly happy with however it goes as long as the bull is still in charge.
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