CLICK ON CHART TO ENLARGE
Does the idea of buy low and sell high still make sense? If so, does a 50% year to date decline qualify as low enough to buy? Mining stocks have had a rough year for sure! The Miners ETF (GDX) was recently down 50% from its January 1 2013 price.
Over the past few months, the decline in GDX could have formed a bullish inverse head & shoulders pattern. The right shoulder might be in place. If this read is correct, a strong rally should take place.
For this pattern to work, GDX CAN NOT break below the right shoulder, if it does the pattern is a bust.