Wednesday, February 18, 2009

Gold miners!!!

GDX which is a gold miner index is underperforming relatively to gold price. It should catch up and aggressively rally as long as the gold price trends higher or even just sustain this level. Just think about what happend to the oil stocks when oil price shot up or even GDX when gold price peaked out last yr. I'm still accumulating GDX but I am definitely going to agressively cut it if there is a significant rally in the near term because gold stocks are extremely volatile. If there is a temporary slip in the gold price, the gold stocks will tank harder, thats the risk and thats why i always place a protective stop loss order for gdx.

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