Are you looking to diversify your investment portfolio and capitalize on the potential growth in the precious metals sector? The Extreme Investor Network has got you covered. Our team of experts has been closely monitoring the recent developments in the market, particularly in gold and gold mining stocks, and we have some valuable insights to share with you.
While growth stocks have been dominating the market in recent years, there has been a noticeable shift towards more value-oriented sectors. Our analysis of the charts of precious metals indicates that the recent rally in gold prices could just be the beginning of a broader uptrend in the coming months. The weekly chart of gold, tracked by the SPDR Gold Shares (GLD), shows a promising three-year basing pattern that has been forming since mid-2020. This pattern, characterized by consistent resistance levels, was finally broken to the upside in March of this year, signaling potential further upside for gold.
When it comes to gold stocks, they have been lagging behind gold prices for the past year. However, in the last six weeks, we have seen a renewed strength in gold miners, outperforming spot gold. This turnaround in performance could be the start of a “catch up” trade where gold miners close the performance gap with gold. The VanEck Vectors Gold Miners ETF (GDX) has shown a double bottom pattern over the last six months, with a significant rally since the February low. If the GDX can break above a key resistance level, it could mirror the upward trajectory of gold prices.
To have confidence in further upside for gold miners, it all depends on the continued rally in gold prices. With the current strength in precious metals and other commodities like copper and crude oil, we believe this could be part of a broader advance in the commodity space. Investors looking to diversify their portfolios away from growth stocks may want to consider adding gold stocks as the technical indicators continue to improve and impress.
At Extreme Investor Network, we strive to provide our readers with valuable insights and analysis to help them make informed investment decisions. Stay tuned for more updates and recommendations from our team of experts as we navigate through the ever-evolving market landscape. Remember, before making any financial decisions, it’s always advisable to seek advice from your financial or investment advisor. Check out our full disclaimer for more information.
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