Miners Exhibit Improving Relative Strength and Participating in an Upmove in the Major Market Indices (for a Change)
Yesterday's headline news from Caterpillar Inc. (CAT), and from Fed Chair Yellen, could have cratered the miners, but bids emerged into weakness in both instances, which represents a positive profile change from time's past.
That said, despite near-term relative strength, the Direxion Daily Gold Miners Bull 3X ETF (NUGT) must hurdle key resistance along the Aug-Sept resistance line, now in the vicinity of 3.30, which, if accomplished, should trigger upside continuation that confronts more important resistance lodged between 3.50 and 3.70.
The 4-week price action has taken the form of a potentially powerful near-term base formation that is putting increasing upward pressure on the resistance levels sighted above.
Only a sharp reversal and break of the Sept 22 low at 2.71 will compromise the developing constructive set up.