You have seen seven years of surpression instigated by the loss of the USA’s AAA debt rating, as Gold was hitting highs, ratting out the FED and US Treas, that this was OK. We can see by this time it didn’t turn out so well. The GDX plunged 50 points, from 62.5 to 12.5, where it refused to budge. This took the Gold Miners Index to the bottom where the US Govt shut down the Miners in 1942, arguably the lowest point of WWII, an 80% drop, where the GDX refused to break and bottomed out. In my opinion, this was the direct result of whom I suspect was JPM acting as agent for the Exchange Stabilization Fund (ESF), a sub-unit of the US Treasury, sold the equivalent in paper forward contracts, of Newmont Mining’s most recent two years of production, in ONE DAY. As a result the real Metal Gold price, and holders, bambozzled by this smoke and mirrors act, reversed the trend which ended at 1049 US, the price of the “India” put.
In the aftermath of this sham, Gold Metal real, broke out of its old high, and registered a new one this month at 2050 US, and the GDX ralled from 12.5 to 45.40, 363%, or a bona fide triple, with more in the offing as it digests this gain. Seems as if further gains are to be had by those who can stay in the Gold Miners without getting shaken out by intra-day shenanigans.
Yes the beginning was long ago, and not 2012 when the USA credit rating was downgraded. Events can trace back to 1971 when Nixon removed gold convertability from the US Dollar, to 1933 when FDR took the USA’s gold private, and on and on. It matters not at all, zilch, zero, because this is now. 2020, when financial fundamental shenigans distortions finally came into open view.
What happens now / next ? Here are two different momentum charts based on the breadth of the GDX, showing a new uptrend likely to start in September, in my opinion.
And #2
The middle figure is the clearest in terms of momentum movement, which allows you to see what I think is an imminent turn-up from the downtrend or flat correction from July, into an uptrend sometime in September. I won’t belabor the obvious, and tell you what I think you do, because I think if your reading this your savvy enough to know.
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