Check Out The Chart: Junior Gold Miners Looking Bullish

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In this special edition of “Check Out The Chart,” we're going back to the well (or the mine) with an ETF that we touted several weeks ago, the Market Vectors Junior Gold Miners ETF
GDXJ
. As we previously noted, the Market Vectors Junior Gold Miners ETF and its larger cousin, the Market Vectors Gold Miners ETF
GDX
spent plenty of time lagging spot gold prices earlier this year. Fortunately, the charts show us that scenario has changed. In fact, a look at the chart of the Market Vectors Junior Gold Miners ETF shows the ETF has cleared some stiff resistance at $38. That's bullish sign Number One. Bullish sign Number Two would come in the form of that old resistance turning into new support in the event of a pullback. Should $38 turn into new support, that area becomes an ideal entry point or a place to do some dollar-cost averaging. The other scenario to consider with the Market Vectors Junior Gold Miners ETF is that gold will crack stiff resistance of its own around $1,900 an ounce, meaning a small position in GDXJ is advisable here and now. Looking at the chart, the ETF has a clear runway back to resistance at $42. If the Market Vectors Junior Gold Miners ETF can break that area on strong volume, the 52-week high at $42.97 will fall as well and the ETF could run another $3-$5 from there. There's something else to consider: In the past month, the SPDR Gold Shares
GLD
, which is backed by physical gold, is up almost 6%. Impressive, but the Market Vectors Junior Gold Miners ETF is higher by 12.4% and that's NOT including Thursday's move higher. Check out the chart.
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Posted In: Long IdeasNewsSector ETFsShort IdeasSpecialty ETFsSmall Cap AnalysisFuturesTechnicalsCommoditiesSmall CapIntraday UpdateMarketsTrading IdeasETFsCheck Out The Chart
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