While the indexes have been trying to create a bottoming pattern, the gold miners are in the second quarter and breaking out to higher highs. As a lot of the world’s gold miners are listed on the Canadian Toronto Stock Exchange, I am always aware of what is going on in the space. Well, two charts suggest paying attention in general and the last three charts are nice large miners listed on both sides of the border.
The first chart is the global mining index. As a group, this chart has been beaten down with Copper’s drop in 2018. Last week, the daily Chaikin Money Flow went positive.
Follow that chart up with a specific division within mining stocks which is the global gold mining index. On Wednesday, November 21, it made a positive Chaikin Money Flow (CMF) reading for the first time in months. It looks very small, but you can see it on the legend as a positive number.
What makes this CMF positive reading more interesting, is the Commitment of Traders report reached extremes in positioning on Gold and Silver in the last few months.
The Index symbols above are not tradeable, but the three stocks below look tremendously well set up.
Barrick Gold, the world’s largest gold miner, looks great! Notice the consolidation just under the breakout level. The CMF is quickly accelerating here as the price consolidates. The big move Wednesday, November 21 that is visible in the zoom panel as well as the PPO about to turn higher above zero adds up to a strong setup. Notice the size of the positive volume candles in the zoom panel recently. Wednesday’s move was the first on above average volume.
Franco Nevada is another great looking chart.
Lastly, Agnico Eagle (AEM) looks well set up. The PPO is just moving into positive territory. It is breaking the down trend in price and approaching a nice horizontal resistance level. The relative strength breakout to three-month highs looks terrific.
Trading is never easy, but the setup for all of these charts is favorable. Trade with stops as the market is particularly volatile.
You may be interested in learning more about charting your investments. Click here to buy a copy of my book! Stock Charts For Dummies. It has lots of great reviews.
If you want to check out my latest 30-minute video on why I think the mood is turning to growth stocks, click on this link. The Final Bar with Greg Schnell.