GDX update

In my previous GDX update I noted a little squiggle (see red circle) in the wave that I thought worth mentioning.  I wrote, " I circled some sideways stuff that could count like a triangle and if it is a triangle then we are already working on C of the bounce."

Well, today we got another piece of the puzzle and I am now wondering if this is forming a rising wedge. If so then its going to be very smart just to hold JNUG for the next 3-4 days until that top rail is hit and at that point put in a 1% trailing stop.Look at wave 2 vs wave 4.  Wave 2 is complex and sideways in nature, wave 4 is more of the vee shape.  A break down of the lower rail will suggest that something else is unfolding.  There are no guarantees when trying to interpret the face of an etch a sketch machine which is drawing in near real time.

And then, while still above the top rail, flip short into JDST because if this is correct then know in advance that rising wedges which are 1st waves up like this are often times retraced nearly all or all the way back down.  In the case of the JDST trade, the rules are easy. 

• Make the flip when you see 5-3-5 completed which also kisses or throws over the top rail and preferably also hits an important fib retracement like the 50 fib as shown below. 
• Once you flip, use stops on JDST just above your flip point.
• Beware the blue path!  If you are in JDST and the wave kisses the 38.2 (or the 23.6) fib in an a-b-c, GET OUT.  Not only that, but flip long JNUG.
• The blue path would destroy any JDST longs.

So, if we see a great GDX/GDXJ/JNUG rally up to the 50 fib as shown in red, don't get giddy, get out!