For weeks, the GDX has been on the edge of a break out, while showing signs of the corrective pullback we would rather see first.
But, as I have said many, many times, when the metals finally turn bullish, retracements often are VERY shallow, as they do not let the masses into the market.Rather, the pullbacks are often so shallow that most market participants have to chase the market.And, it makes it very hard for the average investor to get into the market, if they did not buy at the absolute lows.
If you remember back in the last quarter of 2015, I wrote repeatedly about how I was moving into a FOMO (Fear Of Missing Out) perspective, since I understood very well how the metals move.For this reason, I continually reiterated that I was following the long term plan I laid out years ago, and bought metals and miners heavily at the end of 2015 into early 2016, as we were striking our long term “BUY BUY BUY” box targets.
In fact, we rolled out our EWT Miners Portfolio in September of 2015 in our expectation of imminently striking the long term bottom in the complex.Our initial buys were on 9/16, which included SA at 5.81 (now at 13.50) and RIC at 2.59 (now at 8.50), and then added more on 10/23, including ABX at 7.64 (now at 18.40).While we have seen tremendous gains in many mining stocks we have owned, we plan to rotate our holdings within the safest miners we track to those with the most potential, as we move out of those that strike the targets we set.
And, as many of you know our methodology, we have appropriate suggested stops on all positions to lock in a significant majority of the profit we have earned to date.Moreover, due to our conservative perspective (until the long term bottom is confirmed with a rally through 28 in the GDX), we have not allocated any funds to the junior miners in a meaningful way yet.But, once we do see a confirmed bottom signal, then we will begin rotating to a number of the junior miners we have been tracking, which will likely super charge our returns even more, but doing so only once the risk of lower lows has significantly passed, since a bottom will have then been confirmed with an 80% probability.
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