GDX / NUGT Update and Long Term (LONG) Trade Set-Up

Several days last week (Thursday/Friday) I felt pretty certain GDX/NUGT which is a current long (NUGT) up +12.5% which is pretty good considering how far we are off the recent bottom, was going to pullback, I feel nearly certain it is going to pullback.

However, you saw the sectors earlier in this post Major Industry Sectors and the one Investment that Seems to be Getting a LOT of Attention and specifically the miners (gold), that's a very hard trend to ignore.

In any case, NUGT is in the trading portfolio as a trading position so normally I'd be exiting NUGT right about now or Friday and entering DUSt for a quick pullback trade (NUGT's pullback), however, I can't bring myself to do it considering what these charts are showing in this group, not over a pullback.

I think there's a good opportunity for a long trade set up (longer term) and or an add/to position here.

 As I've shown before, this base could be a large inverse H&S, the volume is right so far or it could be a Cup & Handle bottom (at the white box around dates).

We were looking for a head fake move below this bearish descending triangle as there was longer term accumulation in the area and major reversals (or really almost any reversal) rarely takes place without a shakeout/head fake move, thus the move below the triangle was not only anticipated, it's where we wanted to enter some GDX/NUGT long. There was accumulation as soon as price broke the support of the triangle.

Here we have a daily chart of GDX (NUGT is the 3x leveraged long ETF of GDX), there's good volume on the break out back above not only resistance (former support), but also above the triangle's downtrend line, however the last two days have put in a hanging man (it could use a gap on the first candle, but the psychology is the same) and what looks like a bearish confirmation of the reversal set up today, however volume is not large or increasing on either day which typically makes for a much stronger and more reliable reversal pattern. 

 This 15 min GDX 3C chart shows the accumulation below the triangle and the recent negative divegrence I've been watching since late last week, I feel pretty confident this will pullback, I don't feel confident in exiting the position on a pullback only.

 My Xover (Daily) screen is also just about a day or so away from a confirmed long signal, only the middle indicator needs the yellow custom indicator to cross over its 22-day moving average which is very close.

Typically AFTER there's a long signal, the first pullback will be to the yellow 10-day price moving average and subsequent pullbacks to the 22-day blue average, in this case it;'s difficult to say as there's a lot of resistance/support congestion right in that area, stops and other limit orders are going to be all over that area and likely run.

This is the 4 hour chart, there are much stronger charts, but this is more than strong enough for me.

So I'll stay put in NUGT and ride this out if it comes to that, BUT FOR THOSE LOOKING TO ENTER OR ADD-TO,  I'D SET SOME ALERTS TO AND BELOW THE $23.20 AREA, I will too and as soon as we see accumulation in to the pullback (which looks pretty high probability), I'll put out a Trade Idea on NUGT/GDX.

I really think this is one of the better long trade set ups out there, just look at the charts of gold/miners posted earlier linked above.