The Gold Stocks

30 minute GLD chart from today:

GLD gaped down in the morning, attempted a rally that failed and then sank lower into the close. Gold has been weak lately and the gold stocks even weaker. The thing is, the chart patterns for a couple of the major gold stock indexes today are intriguing to me. I see positive divergence on the MACD indicator. The hammer this morning after the gap down open followed by strength ultimately outperformance of GLD on the day -- bullish, I'd say. GDXJ outperformed GLD on the day by 0.63%

 

I really like the following $HUI monthly chart:

One can see the bull market in its entirety here.Notice in the chart I have the standard 20 period Bollinger Band overlay shown on this chart. Since the bear market bottom in late 2000 at 35.31 on the index, the price of the $HUI has only gone below the lower band three times and has not been below since the panic of 2008. The gap down this morning at 461.72 was outside of the band, but the $HUI rallied strongly up and closed above it for today. Looking back over the course of the bull market in gold stocks, major bottoms have occurred below the lower band. That isn't to say the bottom is in and we rally straight up from here. I believe that if today wasn't the end of this correction, that the bottom will be in soon.