Mine for Profits in Gold ETF


Shutterstock photo

Market Vectors Gold Miners ETF (NYSE: GDX ) - This exchange-traded fund (ETF) seeks to replicate the price and yield performance of the Amex Gold Miners Index. About 80% of its total assets are in the common stocks of companies in the gold mining industry.

Gold has been a strong performer for almost all of 2010, and this week it again broke to new highs. With gold close to $1,300 an ounce, gold mining companies are returning big gains and dividends.

Yesterday, GDX broke through the top of a resistance line at $54.50 from an ascending triangle . This is a powerful break with a target of $64.

But with the stochastic overbought and near-term profit-taking likely, it may be wise to take a half position now and a full position on a pullback below $53.

GDX Chart

Chart Key

If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .

The 'Off the Charts' Options Trading Secret - In this just-released guide to chart analysis, you'll discover which chart patterns are the most reliable, how to avoid "sucker charts," the characteristics of a true breakout, how to know when the big-money insiders are making a move, and more! Plus, two current trades to get you started. Get your FREE copy here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Stocks
Referenced Stocks: ETF , GDX

More from Sam Collins


Sam Collins

Sam Collins

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by BankRate.com