Looking back at my 10/9 chart below, the ratio seems to have yet again done a good job of identifying the GDX top area and allowed us to manage risk and get positioned. If you combine this with analysis of GDX fractals, structures, OBV divergences, trendline resistance in gold, and the COT data (among other charts), you ended up with a preponderance of evidence to put the odds in your favor. People often believe that even as the stars align on all these reliable indicators that “this time is different”. Yes….occasionally they are different but only during a major trend change and statistically that’s a poor risk to take on as a trader. Selling resistance and buying support works the vast majority of the time. It’s the emotional side and biases we maintain that often prevent us from trading what is right in front of us.

Ratio