A Methodical Job

The great irony with this morning's jobs report and all of the inevitable, accompanying "hot takes" by economists and pundits about what it means for a June rate hike (or lack thereof, or back to NIRP, or QE4, etc.) is that the consolidation in the gold miners has been methodical for a few months now. That may not be much consolidation for gold bugs who loaded up long back in late-April. 

But observing the GDX (ETF for senior gold miners) weekly chart, below, we see that methodical action play out. Specifically, the miners staged a high buy volume rally earlier this year in the face of a prior multi-year bear market. 

As soon as GDX rose to its declining 200-period weekly moving average (yellow), some overhead supply or resistance began to kick in. 

However, it was the nature of the pullback which would be a good tell of how hefty resistance would prove. And we can see the makings of a weekly bull flag (highlighted in light blue) to potentially propel the miners higher into the heart of summer. 

The counterpoint is that the miners are simply giving us a knee-jerk squeeze reaction to the poor jobs number this morning, and that if the Fed does not flinch then gold and miners will get crushed. 

But all we can do is trade what we see, and this morning the miners are showing some serious signs they may be ready for continue the progress made since last winter after a methodical consolidation.