Monday, April 20, 2015

Gold Miners Look Good Here ... Guess What Looks Better?

Here is a series of charts I am watching.

First, the US Dollar, as tracked by the PowerShares DB US Dollar Index Bullish Fund (UUP). Despite the fact that it is rallying today, it has fallen below its trendline of the last six months. Its rally seems to be stagnating.

And gold still can't get out of its own way. It is down today as well.

But take a look at the Market Vectors Gold Miners ETF (GDX).  You can see that miners are recovering nicely ...

We don't want to give this the "all-clear" yet because the metal isn't following ... yet. Now, miners usually lead the metal. So, it's likely that gold miners are putting in a bottom and the metal will follow. This seems more likely when you see that the miners seem to have put in a double bottom ...

(Updated chart)

I think that looks pretty bullish for miners. The metal should follow.

That said, there's something that's acting even more bullishly. And that's energy producers ...

(Updated chart)

Even though the Saudis have added enough extra production to equal HALF A BAKKEN per day, oil prices are recovering nicely and oil producers right along with it. That kind of action in the face of what should be bearish news is very bullish.

Just some things to keep in mind.

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