A Rare Slow and Steady Race

One of the more interesting aspects about the price action in most materials and miners (precious and non-precious) over the last several weeks has been the decidedly orderly nature of the consolidation after previously rallying into the end of summer trading. After all, we are talking about a group of sectors related to commodities, where the price action can be mind-numinbly volatile more often than not. Thus, slow and steady action, in and of itself, should be noted. 

The XME, sector ETF for materials and miners, below on the daily timeframe, illustrates this point with one orderly base after the next. Also note how this latest consolidation is occurring after the late-August $31 breakout level. 

While it is true that some materials miner/steels, such as AKS CLF X, have been underwhelming, and the likes of TECK became a bit too sloppy for comfort, plenty of others have held up remarkably well.

And that XME action likely encapsulates the big picture for materials miners and frames it as a promising setup headed into the FOMC event tomorrow. 

Furthermore, one would think if the U.S. Dollar truly was on the cusp of bottoming, as many seem to be arguing, then the XME would be looking ripe to break down. While that can happen, at the moment the technicals are compelling me to keep a more sanguine view.