I’ll know when I see it, but if volume was YUGE Thursday, then the bottom is close at hand. It was not a pretty day… not by any stretch of the imagination. To the charts…
Gold, in the form of GLD, is now back to where it was late last January, when it was first seen as changing trend to the upside. Volume rose bigly! Pretty much the same for silver, in SLV, it’s back to where it broke out in April, and I was first getting on to the metals. SLV fell on very big volume, as well.
Now, to the miners… we want to note those that fell on big volume… will that be all of them? See: PAAS, HL, RGLD, SGDM, SILJ, ABX, GDX, CDE, FSM, PVG, SSRI, AG and SLW. It was all of them!
Well, that’s it! The Monday 11/14 support level still holds for issues like PAAS, RGLD and CDE, but it doesn’t matter anymore. All the rest have taken that support level out now, too.
Average volume for all was up by a truly large 104% over the 50-day average. That pretty much qualifies as a wash out. Typically, you’d like to see downside volume even triple or more, but that may not be the case with these miners. My guess is that seeing the volume spike that I do for Wednesday, with an even bigger one for today, it would not be surprising if any kind of a relief rally were to get underway, and that a short-term bottom is at hand around here.
There are bigger issues, but they are not coming into play here yet. The metals rose because debt and money creation was getting out of hand. The idea that the new administration would be pledging to spend $1 trillion on a rebuilding of our nation’s infrastructure doesn’t erase those concerns. But, the force of those matters are not what’s moving this market at this time. they’ll come back later, though.
Here’s to your accumulation of real wealth!
Harold F Crowell