GDX runs into sellers again around 27.21
VanEck Vectors Gold Miners ETF (GDX) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
GDX finished Thursday at 25.85 edging lower $0.46 (-1.75%) on low volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (GDX as at Mar 26, 2020):
Thursday's trading range has been $1.99 (7.46%), that's slightly below the last trading month's daily average range of $2.78. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for GDX. Prices continued to consolidate within a tight trading range between 23.79 and 27.21 where it has been caught now for the last three trading days.
After trading down to 25.22 earlier during the day, the ETF bounced off the key technical support level at 25.50 (S1). The failure to close below the support might increase that levels importance as support going forward. Prices are trading close to the key technical resistance level at 28.23 (R1). After having been unable to move above 27.00 in the previous session, the market ran into sellers again around the same price level today, missing to move higher than 27.21. The last time this happened on Monday, GDX actually gained 14.68% on the following trading day.
While GDX ETF is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the two market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for GDX ETF. Out of 409 times, GDX closed higher 54.03% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after five trading days, showing a win rate of 50.12% with an average market move of 0.23%.