Precious Metals Correction Enters Its Panic Stage

It  looks that today precious metals investors started to panic. Nearly every mining company is being sold heavily. For example, big miners are down as follows (at the time of writing this post):

• Goldcorp is down 3.5%
• Newmont: 3.8%
• Randgold: 3.6%
• Barrick: 5.7%

As for smaller miners:

• Fortuna: down 7.4%
• Gold Resources: 7.2%
• Endeavour Silver: 8.5%
• B2 Gold: 4.6%

etc, etc

Now, look at the chart below:

The chart shows that GDXJ (ETF representing smaller mining companies) is still stronger than GDX (big miners) - it is indicative of the bull market in precious metals stocks (smaller companies go up faster than bigger ones).

Note also that GDXJ is very close to its important support at around $44 a share.

Of course, it is possible that the current correction will be much deeper but, trying to look at the big picture, in my opinion, today's price levels create the first major buying opportunity for those interested in increasing their long positions in precious metals stocks. Me included (added a few fresh positions today).


Another note (near NYSE closing time)

The chart below shows today's price action (gold and GDX):

Note, that gold is down around 0.9% while GDX is crashing. 

In my opinion, it is typical panic.