Still Plugging Away

It may seem as though gold and her miners have completely shut down as a group, failing miserably to hold a rally for even a respite from the chop (at best), if not outright multi-year downtrend since the complex featured a spectacular rally in the first half of 2016.

That 2016 rally may indeed now seem like a distance memory, but it is worth noting that the GLD, GDX, and GDXJ ETFs are all well above their prior early-2016 lows.

While that does not amount to a decisive bull victory in any way, shape or form, it does indeed magnify the idea that gold bears, for all of their ballyhoo about how obsolete the pet rock may be with its paper tiger miners, have yet to officially seal the deal with fresh bear market lows.

And now we have seen glimmers of hope for gold bugs with some newfound resilience in the space in the face of the U.S. Dollar rallying for much of autumn. Indeed, one would think gold and the group could have--and perhaps should have--made fresh bear market lows with the UUP ETF for the greenback marching higher for much of 2018. But that did not happen. 

Thus, we are back to a familiar place with select, individual miners like the large cap Barrick Gold notably outperforming amid a sector of sloppy charts yet to prove themselves. While gold bugs can take solace in not seeing fresh bear market lows of late, they need to know the drill by now--Another fumble can quickly escalate a gold selloff. 

As rates fall back down a bit amid Fed Chair Powell softening his monetary stance, I suspect gold bugs will have a do-or-die spot here to show they can pounce on a pausing Dollar.