Underwater Too Long

Today's peculiar upside reversal in the precious metals' miners comes at an important technical spot. 

Not only is GDX (and GDXJ, for the junior miners) oversold, seen on the first chart below for the senior gold miners' ETF, but GLD, ETF for the yellow metal itself, has backtested its 200-day moving average (yellow line on second daily chart, below). 

The main concern we have had in terms of not playing this space aggressively on the along side in recent weeks has been that the precious metals themselves have outperformed the sluggish miners. Typically, the precious complex is far more bullish when the miners enjoy thriving risk appetite and are out in front of the metals.

Thus, with the miners oversold and at least showing a pulse, and gold bounce off its 200-day from above it, the setup into the rest of the week is at least colorable on the long side if gold bugs can muster actual follow-through higher. 

It is worth noting that despite the tedious price action in this space since last summer, the group remains well above their winter 2016 lows and still threatens a multi-year trend reversal higher.