Potential Intermediate Term Targets for Gold and Gold Stocks
The precious metals complex is correcting in the near-term; expect that to continue for the next several weeks.
Moving to the shares, we note that GDX faces its next major resistance at $65. A potential cup and handle pattern projects to the $90-$93 zone.
The GDX vs. gold ratio shows 0.40 to 0.45 as a potential future target zone. Figures of $2,250 for gold and 90 for GDX equate to a ratio of 0.40.
The precious metals complex is correcting in the near-term and we expect that to continue for the next several weeks. Following the correction we see immediate upside targets of $1,900 for gold and 63-65 for GDX. Essentially, the next breakout should result in a retest of the former highs. Moving beyond the medium term, we see a target zone for gold of $2,300 to $2,500 and GDX to 90-93. The timetable for such is in the next 15 months. In the meantime, the sector is correcting and we expect that to continue for the majority of October. Thus, be advised that the coming weeks will be an opportunity to accumulate your favorite positions at lower prices.
Editor's Note: See more from Jordan Roy-Byrne at The Daily Gold.
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