From the Desk of Ian Culley @IanCulley
Mining stocks are sticking their breakouts as our list of trending tickers grows.
The Junior Gold Miners ETF $GDXJ is breaking out, platinum futures are completing a yearlong base, and the silver-to-gold ratio is posting new highs.
With risk-seeking behavior creeping back into precious metals, it’s time to turn up the heat…
Check out the silver/gold ratio printing a fresh six-month high while violating a multi-year downtrend line:
Finally, Silver is bringing it!
I won’t get too carried away by these six-month highs. But it’s a start.
Trend reversals begin with trendline breaks. The silver-to-gold ratio is piercing a downtrend line drawn from the 2021 peak, signaling the early stages of a bullish reversal while revealing an uptick in risk appetite.
Plus, GDXJ is breaking out!
We have our levels for Gold and Silver, so let’s focus on a mining stock trading at a key area of former resistance.
Here’s McEwan Mining Inc. $MUX, a $500M gold miner based in Toronto, Canada:
MUX is pulling back to a critical shelf of former highs.
Stocks retrace to their breakout levels all the time. Last week’s weakness appears to have been a standard retest so far.
Considering the bullish backdrop, I like taking a swing at this junior miner.
We can own MUX above last week’s low of 9.81, targeting 25.50 (at approximately the 2018 highs).
On the other hand, today’s standard retest could turn into a failed breakout if McEwan Mining undercuts last Thursday’s low.
All bets are off if sellers drive it below our risk level.
But if silver continues to outpace gold, my spidey senses tell me this junior gold miner is heading higher.
Are you buying the dip in MUX?
If not, why?
–Ian
Click here to watch this week's Gold Rush Video:
Thanks for reading.
Let us know what you think. We love hearing from you.
And be sure to download this week’s Precious Metals Report below!
Allstarcharts Team
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