It was a brutal day for the gold mining sector with a 3.61% loss and a close at session lows:
Today’s candlestick is called a ‘bearish marubozu‘ due to the large full body with an absence of shadows on either side. Interestingly enough today’s session offers a mixed picture with both bullish and bearish takeaways.
5 of the last 7 times that GDX had a 3%+ sell-off and formed a bearish marubozu GDX also went on to close lower the following session:
However, the results 5 sessions later are much more mixed with a large rally in August 2013 and a large decline in April 2014:
In summary GDX is likely to see some more short-term downside before we find some stability later this week or early next week near the April/May lows and the uptrend drawn from March low ($19.25-$19.75):
