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Since March I have been sharing with members that miners looked to be creating a bullish inverse head & shoulders pattern and that the right shoulder needed to be completed.
Premium & Metals Members that are aggressive traders bought the miners (GDX/GDXJ) on June the 6th at (1) in the chart above. Last week a strong rally took place following a positive power of the pattern set up in the mining complex, with several mining index’s moving 10% higher in five days.
Did last weeks rally confirm that the bullish inverse head & shoulders pattern is completed? Not yet in my humble opinion. So far I like what I see. I am sharing other resistance levels with member that I feel are key to keep this pattern going.
Power of the inverse head & shoulders pattern…. Natural Gas rallied 89% in 9 months off this inverse head & shoulders pattern two years ago this month (see NG H&S pattern here) Yields formed one last year and interest rates blasted off, jumping 37% in 7 months, hurting bonds big time (See Rate H&S pattern here)
This pattern has tons of potential thats for sure. For it to be confirmed, other price action needs to take place. If playing the metals or mining stocks is of interest to you and you’d like to be informed of our pattern thoughts on this sector, I would be honored and humbled to have you as a member.