Going For The Gold? Mining Stocks Trying To Break Out

After three months of declining gold prices and falling gold mining stocks, the winds have changed in December.

Both Gold (GLD) and the Gold Miners (GDX) are rallying sharply.

Can the Rally in Gold Mining Stocks Continue?

As the chart below shows, the Junior Gold Miners (GDXJ) are breaking out of a 3 month downtrend. This disrupts the momentum to the downside and offers opportunity to the upside (if price can successfully consolidate above the breakout).

The junior miners are a good test case for traders as they offer the most beta (risk). The same way the stock market is risk-on when small cap stocks are leading, the gold market is bullish when junior miners lead.

Keep an eye on the miners here – perhaps Santa will leave gold in traders stockings.  Ha!

Thanks for reading.

Twitter:  @KimbleCharting

Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.