Unconvincing Rebound in GDX - April 10, 2010

Monday’s trading in GDX was much quieter than anticipated and was the second inside day in a row closing near the lows in relationship to Wednesday’s sell-off bar, frustrating both bulls and bears. But Money Flow recovered some energy in spite of only one-third of GDX component stocks participating to the bounce. Most of the positive action was in Randgold (GOLD) which is some kind of an outsider with its current geo-political concerns over its Mali mines. So this bounce is very weak and lacking broad participation, although large players were buyers yesterday. The most noticeable fact is the emergence of nascent relative strength compared to the rest of the market which was hurt badly, but it has often reversed quickly recently.

Earnings season starts today but the first Precious Metals miners to report will be GG, AEM and NEM within the last week of April and it shouldn’t influence much the short term outlook.

The RT Money Flow rose a little closer to its average where a buy signal would trigger after crossing the porosity level (+0.118% today) above the average.

On multi-pivot ground, GDX closed above Monthly S1 (46.27) increasing total support clusters strength to 27 vs 6 for total resistance clusters strength. This configuration should normally help another bounce today.

The EOD GDX and IWM robots found no tradable setups with edges today.
Billy

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