[GDXJ] update

In my previous post on GDXJ I provided a  short term caution about a potential dip to $26.46.  Instead the pullback came to $26.52, only a few cents from the target before rebounding (green arrow).  Per that model we are now pulling back into 2 of 3 with the next move being a big jump into 3 of 3.  That model is provided below in order to ensure clarity.

While this model could still be correct, I believe I will have to change the count as a result of how far today's pullback took us.  The 61.8 fib did not hold and that is about the most I like to allow for a normal wave pullback.  So I now believe that the count is per below and again my W3 indication played prominently into my thinking.  There is good news here for gold lovers: This was not a huge WC.  This was certainly a 5 wave move up and as a result the odds are very high that after the current pullback is done we will see an even stronger move up in both GDXJ and JNUG.

Keep in mind that if the count below is correct, the lower rail could fail to hold.    In other words, the gap fill would not be enough reason to turn the herd back north again. In fact, we might have to pull back to the 50 fib if the 38.2 does not hold.

Bottom line, Avi's count is most likely bust and while we should thus expect another big wave up from the coming low, this will be the C wave of the conventional wisdom count with another monster deflationary crash wave to follow.  In this case, you just have to let it play out.  Many of the juniors will go bust in that event so be very careful about buy and hold thinking.  But let's not get too far ahead of ourselves.  Before we have to worry about that, the momo crowd is going to pile into the likes of TRX and probably triple it from today's price of 63 cents.  This should happen as JNUG moves into its big 3rd (or C) wave up.


Late breaking edit: I forgot that I already posted the potential for the GDXJ model change on this post that was written on Jan 14th.  Bottom line is that I think odds are high that this is a 2nd wave pullback target should be either the 38.2 fib or the 50 fib of the entire rally since mid December.  That comes to between $26.10 and $27.22.  Today's sell off down to $27.67 is just shy of my expectation and the wave looks like w3 of C has been put in so let it play out to the low $27 range on Monday and then when a full a-b-c has transpired, re-load up again on JNUG for WAVE 3 UP.  Stops of course below that C wave!