Junior Gold Miners Setup A Double Bottom – Looking For A Rally Off These Unique Lows

The Junior Gold Miners ETF (GDXJ), fell to lows near $43.06 recently, which matched the low from the end of March 2021, near $43.24. Although these lows are not exactly the same, the span of time between these unique lows and the very close nature of them makes them a Double Bottom setup.

It is very likely that this support level will prompt a new upside price rally in Junior Miners targeting $50 to $52 or higher if the support level near $43 continues to hold.

GDXJ May Be Starting A Rally To $55 or Higher

This could be a very exciting rally for Junior Miners and Precious Metals. After nearly a year of metals and miners drifting lower and sideways, this Double Bottom pattern may prompt a fairly strong rally leading both Precious Metals and Miners up the next rally phase high.

This GDXJ Weekly chart shows the Double Bottom near $43 and shows an early rally phase that may have already started in GDXJ. If price rallies above $47.50 on strong upward momentum, it will likely attempt to rally above $55 and retest the recent highs from May 2021.

If our research is correct, this move would likely see the US Dollar weaken and Precious Metals attempt to rally. That type of move would push Junior Miners much higher over the next few months.

If GDXJ falls below the $43 Double Bottom level, then we may see even deeper downside price trending for Metals and Miners – possibly targeting previous support near $39.50. Miners have been moving sideways in a defined downward price trend since the peak in August 2020. If Miners were to break below the $43 support level, it would likely happen at a time when the global markets were also under moderate pricing pressure – resulting in a fairly deep broad market pullback.

Sign up for my free trading newsletter so you don’t miss the next opportunity to learn more!

We certainly live in interesting times as the US Fed continues to attempt to push the markets into uncharted territory. I expect Precious Metals to attempt to find a bottom soon and any breakdown in price over the next few months may be a strong warning that the global markets are disconnecting with risk assets. In other words, something big is taking place that may represent a volatility event taking place

The next few months may be full of volatility and big trends. There will still be endless opportunities for profits from these extended price rotations, but the volatility and leverage factors will increase risk levels for traders that are not prepared or don’t have solid strategies. Don’t let yourself get caught in these next cycle phases unprepared.

Please take a minute to learn about my BAN Trader Pro newsletter service and how it can help you identify and trade better sector setups.  My team and I have built this strategy to help us identify the strongest and best trade setups in any market sector.  Every day, we deliver these setups to our subscribers along with the BAN Trader Pro system trades.  You owe it to yourself to see how simple it is to trade 30% to 40% of the time to generate incredible results.

As something entirely new, check out my initiative URLYstart to learn more about the youth entrepreneurship program I am developing. This is an online program of gamified entrepreneurship designed to introduce and inspire kids to start their own businesses. Click-by-click, each student will be guided from their initial idea, through the startup process all the way to their first sale and beyond. Along the way, our students will learn life lessons such as communication, perseverance, goal setting, teamwork, and more. My team and I are passionate about this project and want to reach as many kids as possible!

Have a great day!

Chris Vermeulen
Chief Market Strategist

Privacy Preferences
When you visit our website, it may store information through your browser from specific services, usually in form of cookies. Here you can change your privacy preferences. Please note that blocking some types of cookies may impact your experience on our website and the services we offer.