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Saturday, May 12, 2012

Not Happy

Stream_wbic5ni

http://chart.ly/users/PeterLBrandt 

Not me!  Even my long-term trend following model says that GLD commenced a new downtrend this week by closing below the lower channel boundary.  So much for bullion.  Gold mining shares have been much weaker than bullion for a long time.  Gold mining etf, GDX is down 36% from the peak while bullion etf, GLD is only down 16%.  Last week the K-Ratio hit .25,  signaling that gold mining shares have become undervalued in relation to bullion.  Both could fall for a long time, but on the next upswing, gold-mining shares will be the vehicle of choice because they could be much stronger than the metal.

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