PHLX Gold/Silver Sector – Approaching Long-Term Support While Deeply Oversold


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  • Stochastics are on a sell signal, but are deeply oversold. RSI is oversold. MACD is on a sell signal.
  • Broke solidly below “cross” trend line (in red) at the 140 level.
  • Approaching a test of long-term trend line support (in blue) currently at the 78 level.
  • Buy on weakness the closer it gets to the 78 level. Use a 73 stop.


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Olson Global Markets represents our Bears in Control, Early Accumulation Phase. This symbolizes a category of securities that may be subject to the following characteristics.

Psychological Characteristics:

  • Consensus of investors recognizes bearish price trend
  • Majority is committed to this trend
  • Bearish sentiment is strong and emotional
  • Bearish fundamental story is fully understood
  • Majority doubts a reversal of trend is imminent
  • Minority believes a reversal is imminent
  • Bullish commitment to stock is weak
  • Crowd is increasing in size
  • Stock is vulnerable to positive shocks

Price Characteristics:

  • Price is at or near its two-year low
  • Price has fallen substantially from its two-year high
  • Stock or industry group appears to be consolidating and/or forming a base
  • Stock or industry group is in recognizable downtrend

Buy : a stock expected to move higher on an absolute basis in the next 6-12 months.


Analyst Information:
Jim Donnelly


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This article appears in: Investing , Investing Ideas , Economy , US Markets

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