Is the Bottom in For Gold?

by JDH on March 31, 2018

I have no idea.  It all depends on how you want to interpret the chart.  Here’s NUGT – Direxion Daily Gold Miners Bull 3x Shares NYSE + BATS:

As you can see, there are four important bottoms so far this year:

  • February 9 at $21.42
  • March 1 at $21.25 (which is worrisome, because it is lower than the previous low)
  • March 20 at $21.93
  • March 28 at $23.13

NUGT closed on Friday at $24.40.  So, if NUGT doesn’t go below $23.13 in the next week or two, we can presumably assume that the bottom is in.  That’s the point of a series of higher lows.

It is also encouraging that in the last month NUGT made a high at $25.48 on March 6, and then exceeded that high at $26.25 on March 26.  Higher highs is good.

But looking at a longer term chart, we also have a series of lower highs, so there is no evidence that NUGT, or Gold, is about to blast higher.

So, my strategy is to maintain a position, but if NUGT closes below $23, see you later, sell, take my losses and move on.

That’s the plan.  Happy Easter.  More next week.