by Jordan Roy-Byrne, CMT
The Daily Gold
Last week we projected 5% to 10% downside in the gold stocks. Well, not to butter my own bread but GDX and GDXJ both lost 9% on the week. That being said, I believed that the weakness would be limited and miners could rebound to new highs in September. While that possibility remains, there is a chance this correction could go a bit deeper and perhaps last longer.
The weekly candle charts below show that the miners are correcting after failing to break into a “thin zone” of resistance. GDX has broken below its July lows and corrected as much as 16%. It has support at $25-$26 and that includes the Brexit gap.