Although gold is under considerable pressure, the outlook seems even worse for gold mining stocks. This development can be easily visualized by looking at the weekly gold to HUI ratio, which currently stands at 6.569 and getting very close to the falling 40 week moving average at 6.615.
Bullish divergence is detected on the 14 week relative strength index and also in the MACD-V indicator. Expect further weakness in gold stocks relative to the price of gold, with focus on the gold to HUI ratio rising toward the Fibonacci 61.8% retracement level of 8.17, based on the 9.88 to 5.40 range traded since February 2024.
Disclaimer
Our opinions are not a recommendation to buy or sell a security. Your decision whether or not to open a transaction should be based on your own due diligence and not on any representation we make to you.
