GDX Overbought

[Pascal]

Since we closed above the Overbought level, the model will turn to cash if we cross below the OB level and if the confidence level of staying below that level by the close is higher than 80%.



Pascal

[Pascal]

Even though the probability to reach OB is 23%, in reality the market is very quiet and we are close to a long week-end. Hence, the probability to reach OB today is much smaller I believe.


Pascal

[Pascal]

As you have noticed, the 20DMF pushed higher, thanks to the Q1 window dressing buying. However, the GDX MF was under pressure, while the GDX price was pulled higher by the general market.

This does not look good for the long position, but we are protected with the OB level. If we cross this level, the model will turn to cash.

On the GDX Model, I highlighted in Yellow the Strength status. You can see that both Buy and Short are "Strong". However, these are the status calculated at the end of the day previous to the actual close. The new status for the next trading day is calculated overnight, but the GDX Model only starts when the market opens and he thus adapts this field at that time.

However, if you are interested, you can go to the main page of the GDX Model, where the status is updated as soon as it is calculated during the night. You can see that both long and short are "weak" for the next open.




Pascal

[Pascal]

Since the reversal to cash was never confirmed and since we closed above the OB level, the model stays in a Buy mode for now.


Pascal

[Pascal]

We are now back to cash in the GDX Model and the weakness of the past days is strongly confirmed today.


Pascal