Wednesday, April 3, 2013

Capitulation in gold stocks

Looks like a capitulation is finally occurring in the precious metals stocks, both the HUI and GDX have now taken out their February lows, which is not a surprise given the choppy advance bear flag pattern that had formed - see the charts.

Perhaps this sell off will finally cause some of the die hard gold bugs which have been hanging on the dear life to finally throw in the towel. 

In the short term watch to see if the lower trendline of the channel may act as support.  Also be on the lookout for a reversal or hammer candlestick which would may market a capitulation.

This has been the worst sector in the market bar none. 

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