Miners Falling Down a Shaft

If you're thinking (hoping) that precious metals miners' prices will stop falling then you could be disappointed. Sunshine Profits writes in, Is It Right Time to Buy Mining Stocks?

In this week’s very long-term HUI index chart (a proxy for the gold stocks) we see that miners finally moved close to the upper border of the declining trend channel. Soon after that, they declined once again (it happened yesterday) and could be that the correction to the upside is already behind us.

The trend remains down, and another decline is likely before the final bottom is formed.

Where will it form? In our opinion, close to or slightly above the 2008 low as indicated in the above chart by the red ellipse (which also includes the 61.8% Fibonacci retracement level).

And where would the 61.8% Fibonacci retracement level take the Hui? Around 150.

The bottom line:

Summing up, the outlook for mining stocks remains bearish. Miners are still in a downtrend and it seems that the next move lower will probably be the one to take miners to their final bottom

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• The Outlook For Gold Mining Stocks Remains Bearish