Over the next 3 weeks gold and the miners may drop a bit more (gold perhaps hitting its 100 WMA around $1725), but it is also possible gold and the miners have already bottomed.  In either case, I think the gold miners are a fairly low risk entry here, although some miners could drop another 10% on a panic sell off over the next few weeks.

For example KGC is one I am watching.  On the weekly chart, it has already hit its 100WMA, which is usually a good spot to get long in a bull market.  On the daily chart (see below), I believe a worse case scenario would be a tag of its 600 day MA at $5.88, although there is no guarantee it will get hit.  It is already extremely oversold (see the daily RSI and MACD in the chart below compared to other significant lows), which to me strongly suggests the risk-reward favors getting long.

I believe over the next 6 months it can retest the $14-18 resistance zone established in 2011-2012.  While I have been saying the rally is likely to start later in the year, the more I look at some of the longer term moving averages and their convergence, I think gold miners like KGC are ready for very large moves starting very soon.

The situation with silver miners is not so clear cut, since I think silver could underperform gold at least initially, especially in the short term if gold gets hit again over the next 3 weeks.  That being said I think certain names, like AXU, are almost ready to rip.  AXU is trading at $2.50 today and it’s possible it could tag its rising 100 WMA around $2.30 before it is ready to rip higher, although it may have also already found a low.  I am expecting a move to $6-7 once it bottoms.

This is not investment advice, just my outlook.  Investing in mining stocks is extremely risky.