Dow Theory Update for June 21: Primary Bear market for GDX and SIL signaled on 6/20/23

 Gold & Silver could also enter a bear market on today’s close

 

I am writing before the close of 6/21/23. So, readers, beware, things may change.

Executive Summary:

1. The primary trend for gold and silver is bullish, the secondary one is bearish, and the setup for a potential primary bear market signal was completed on 6/1/23, as I explained HERE. If GLD closes below 180.2 and SLV below 20.86 (secondary reaction lows), a primary bear market will be signaled

2. The primary trend for gold and silver ETF miners (GDX and SIL) turned bearish on 6/21/23. More in-depth info is below.

General Remarks:

This post thoroughly explained the rationale behind using two alternative definitions to appraise secondary reactions. 

GOLD AND SILVER MINERS ETFs

A) Market situation if one appraises secondary reactions not bound by the three weeks dogma. 

The primary trend was signaled as bullish on 4/4/23, as explained HERE.

In this post, I explained that the primary bear market signal setup was completed on 6/1/23.

On 6/20/23, GDX and SIL broke down below their 5/30and 5/25/23 secondary reaction lows, signaling a primary bear market. The Table below shows the relevant prices.

The charts below show the most recent price action that led to the primary bear market signal. The brown rectangles highlight the secondary reaction that started from the 4/13/23 highs. The blue rectangles display the rally that followed the secondary reaction lows. The red horizontal lines highlight the secondary reaction lows (the relevant level to be pierced for a new bear market).

B) Market situation if one sticks to the traditional interpretation demanding at least three weeks of movement to declare a secondary reaction.

The primary trend was signaled as bullish on 4/4/23, as explained HERE.

In this specific instance, the trend appraisal using the “long-term” version of the Dow Theory yields the same results as the “short-term” one. So, the setup for a potential primary bear market signal has been completed. Please check the table, charts, and explanation given above.

Therefore, the primary and secondary trends are bearish.

 Sincerely,

Manuel Blay

Editor of thedowtheory.com