GOLD AND SILVER ETFS TEST UNDERLYING SUPPORTS WITHIN MAJOR UPTRENDS -- SO DO THEIR MINERS

GOLD ETF AND ITS MINERS TEST UNDERLYING SUPPORT... Precious metals have spend most of August pulling back from their recent strong advances which has enabled them to work off some short-term overbought conditions.   And they're testing underlying support levels.  Chart 1 shows the Gold SPDR (GLD) testing a previous low formed earlier in the month; as well as a rising trendline drawn under its March/June lows.  It's also not far from its 50-day moving average (blue arrow).  Its 14-day RSI line in the upper box is also finding support near the 50 line.  That action is consistent with a pullback in a longer-range uptrend.  So is the action in Chart 2.

Chart 2 shows the VanEck Vectors Gold Miners ETF (GDX) testing its early August low and 50-day average (blue arrow).   Its 14-day RSI line is stabilizing near 50 as well.  All of which suggests that gold and its miners are trying to stabilize in some potential support areas.   The same is true of silver and its miners.

SILVER ETFS TEST UNDERLYING SUPPORT... Silver and its miners are also consolidating within their long-term uptrend.  Chart 3 shows recent pullback in the Silver iShares (SLV) forming a "coiling pattern" between two converging trendlines which is usually a continuation pattern.  It also appears to be finding support near its green 20-day average.  Its 14-day RSI line in the upper box also remain above 50.  Volume has also declined noticeably during the August consolidation which is another positive sign.   Silver miners are also testing support.

Chart 4 shows the Global X Silver Miners ETF (SIL) also testing a rising trendline drawn under its March/June lows and not far from its blue 50-day average.   There again, trading volume has dropped off during the August correction which is consistent with a normal pullback in a longer-range uptrend.

SILVER MINERS LONG-TERM CHART LOOKS BULLISH...The weekly bars in Chart 5 show the Silver Miners ETF pulling back from its previous peak formed during 2016 near 50.  The price of silver has already cleared that price barrier and has risen to the highest level in seven years.   That greatly increases the odds that the Silver Miners ETF will eventually do the same.   The current pullback looks like a relatively minor pause in a longer-range uptrend.    Moving average trends are also bullish.  The price of gold is pulling back from record high territory.