Junior Gold Miner ETF hits lower rail of channel and generates bullish signal
Gold started moving higher last September as investors sought some safety as global equity markets started falling. When stocks started rallying after Christmas, gold continued to rally and reached a price of just shy of $1,350 an ounce on February 20. The price of gold fell back down to the $1,280 area from the high through March 7 before rallying back up to $1,325. It pulled back again last week but it looks like it is ready to rally again.
The VanEck Vectors Junior Gold Miners ETF (NYSE: GDXJ) is highly correlated to the price of gold and it also rallied in the fourth quarter and through the February 20 high. The highs from September, October, and September all connect to form the upper rail of an upwardly sloped channel. The lower rail is more of an estimate at this point because the only contact point is the low from November. If that estimated rail turns out to be accurate, the fund just hit the lower rail.
We see that the daily stochastic readings are in oversold territory and just made a bullish crossover on April 3. In addition to that potential bullish signal, the Tickeron AI Prediction tool generated a bullish signal on March 1. The signal showed a confidence level of 77% and past predictions have been accurate 88% of the time.
The signal from the prediction tool calls for a gain of at least 4% over the next month, but I think the fund rallies up to at least up to $33.50 and that would mean a gain of at least 8%.
Momentum Indicator for GDXJ turns positive, indicating new upward trend
GDXJ saw its Momentum Indicator move above the 0 level on October 14, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 94 similar instances where the indicator turned positive. In of the 94 cases, the stock moved higher in the following days. The odds of a move higher are at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Moving Average Convergence Divergence (MACD) for GDXJ just turned positive on October 16, 2024. Looking at past instances where GDXJ's MACD turned positive, the stock continued to rise in of 51 cases over the following month. The odds of a continued upward trend are .
GDXJ moved above its 50-day moving average on September 12, 2024 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for GDXJ crossed bullishly above the 50-day moving average on September 17, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 13 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where GDXJ advanced for three days, in of 272 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 232 cases where GDXJ Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The 10-day RSI Indicator for GDXJ moved out of overbought territory on September 25, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 31 similar instances where the indicator moved out of overbought territory. In of the 31 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GDXJ declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
Category PreciousMetals