One of the more common psychological traps that I see occur quite frequently in the financial blogosphere is for traders to pick a bearish thesis for any number of reasons, and then look for reasons to stay wrong. As puzzling as that sounds, there were plenty of bears all of last week who constantly noted that the silver and gold miners were not participating in the rally. To begin with, the miners have been in multi-month consolidation–especially silver and its miners–as I argued would happen last April in this, and several other posts. Beyond that, if you have not been using them as accurate “tells” for the market, it is misguided (at best) to suddenly anoint them as clear leading indicators, or the “true tell,” just as may traders try to conveniently do with AAPL.
Today, the gold and silver miners are catching up and are the clear standouts in the session, thus undermining the sloppy notion that they were somehow the true tells leading the market down. More on the miners later.
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I’ve been outlining HL for a couple weeks now as well as the GDXJ. Things have lined up nicely with expectations so far.
nice