Correction Underway For SILJ?

As mentioned in prior posts, trend lines are highly subjective so should not be relied upon as the sole basis of buy and sell decisions, however they do give general areas that might provide support and resistance. Keep in mind this chart of SILJ is form Friday’s close, so using the last tick as the final connecting point is risky, we could easily see SILJ trade below my trend line, even down to the 200 day MA in the $10.27 area. Being miners are in an overall uptrend and have been the strongest performers over the last quarter, my bet is the uptrend will remain intact and that dips should be bought. We also woke up to news that Newmont Mining has made an offer for Newcrest at a roughly 25% premium to its closing price last week, so the biggest miners are still looking to acquire others. Interestingly, the media reports that this could spark more bids for Newcrest as the buyout offer is widely thought to be too low, all good news for the group as a whole. I began adding to positions again Friday afternoon before the close, in the miners I recently trimmed (sold 16% of holdings recently), and will continue to buy more as the intraday technical readings reach oversold on the 30 minute bar charts.