Nightly Briefing 4/22/20

We have lift-off in the Gold Miners.

We equate the breakout above $32 in GDX with the breakout in Gold last June piercing the $1375 level. One must understand this level has capped rallies for years in GDX. If one would have bought every attempt at a breakout of $32 the past several years you would have lost a lot of mental and physical capital. The miners have lagged Gold for almost a year. Keep in mind when Gold was $1700 almost a decade ago, GDX was $55 per share. It has a lot of catching up to do. We received a large trending break-away gap today with Newmont leading. We took positions mid-day at lower prices and expect strong follow through the next 2 days. Next resistance area for GDX is the $35-36 region. This may be reached by Friday, followed by a multi-day consolidation before heading to $39. Leveraged NUGT mirrors GDX, our senior mining ETF. Our A.I. monitoring time and energy has been projecting a May top for the Miners. Now that we have our breakout we will hone price targets using our other tools. There is no single standalone tool.

The stock market is moving as we expect with a choppy rally into April 27th before another multi-day pullback and another rally into mid-May.

Limited opportunity in cryptocurrency the next 45 days. Crypto’s normally are inversely correlated to Gold. With Gold showing strength into late May/ early June, expect crypto weakness.

Most leveraged Oil ETF’s are falling below net capital and will not accurately track Crude Oil properly the next 45 days. Gold miners and the stock market offer more potential in the coming weeks. If we were forced to take an Oil position we would recommend buying a highly capitalized Energy ETF like XLE.