Gold (GLD Proxy) in March 2024 is attempting a breakout from a 12+ year Cup with Handle. Big bases (causes) tend to lead to big trends (effects).
There's many clever people who will say why gold is going to [insert high price] per ounce in coming years. Maybe it does, maybe it doesn't.
What I'm most interested in is trading leading precious metal miners from favourable risk vs reward technical locations if the move is going to be a big one.
Chart of AG in April 2016 shows the type of setups I look for.
GLD itself only has a 20-day Average Daily Range Percentage (20d ADR%) of 0.74% at the time of writing. That means it's a slow moving financial instrument. For comparison the SPY's 20d ADR% is 0.82% and the QQQ's 1.18%. So where's the juice being the quicker moving stocks?
Before I list several precious metal miners below, I give significant weight to the relative strength. Why? Because relative strength isn't my opinion or your opinion, it's the opinion of the market. The best stocks in specific groups/themes usually display the greatest relative strength during their basing periods and uptrends. 2024 case in point, NVDA & SMCI!
I trade leaders, not laggards.
UK stocks are often dreadful for 101 reasons, so I focus on US stocks.
Here's several precious metal miners on my radar for continuation base (CwH, Flags, Pennants, Wedges, Darvas Box, Triangles etc) breakouts/pullbacks around key moving averages.
Harmony Gold Mining (NYQ:HMY) - Currently looks to be the leader from a technical and fundamental perspective. 20d ADR% = 4.06% (many times quicker than GLD).
Others include:
Alamos Gold (NYQ:AGI)
Eldorado Gold (NYQ:EGO)
Kinross Gold (NYQ:KGC)
GLD monthly chart showing the large Cup with Handle pattern:
AG April 2016 daily chart showing the type of continuation bases I look for:
