Thursday, December 28, 2023

Dow Theory Update for December 28: Primary bull market for SIL and GDX signaled on 12/27/23


The table below summarizes the current state of the trend for the precious metals and their ETF miners. 


There's a buzz in the air about the USD. Precious metals making notable strides, the Swiss Franc following suit, and both stocks and crypto appear overextended but with a clear eagerness to climb further.

General Remarks:

In this post, I thoroughly explained the rationale behind using two alternative definitions to appraise secondary reactions.


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

The primary trend for GDX and SIL turned bearish on 6/20/23. You may find an in-depth explanation HERE.

Following the 10/4/23 bear market lows, a rally unfolded that qualified as a secondary reaction, as explained HERE.

The setup for a primary bull market was explained in our 12/11/23 post.

On 12/19/23, SIL surpassed its secondary reaction highs (step #2 in the Table below). On 12/27/23, GDX confirmed, thus triggering a new primary bull market (Step #4).


So, the primary and secondary trends are now bullish. Finally, the miners are in sync with the precious metals. Such multimarket and multi-asset confirmation normally reinforces the bullish case.

The charts below show the most recent price action. The blue rectangles highlight the secondary reaction that started off the 10/4/23 bear market lows and ended on 12/1/23. The brown rectangles indicate the pullback that set up both ETFs for a primary bull market. The blue horizontal lines mark the 12/1/23 closing highs, which were the relevant price levels to be broken up. Additionally, past rallies amid the bear market, failing to meet the criteria for a secondary reaction, are represented by grey triangles.

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

I explained HERE, the primary trend was signaled as bearish on 6/20/23.

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, what I explained above applies fully to this section. The primary and secondary trend are bullish. 


Manuel Blay

Editor of







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