Widening our view, here is an update of my note from the end of January (see Here) that takes a broader look at the performance relationship between the miners and spot prices. As expected, the performance series of gold and the XAU index continues to follow the previous cycle's value trap footprints.
While we have utilized the daily BKX:SPX ratio from 2009 to appraise momentum in the sector across the short to intermediate time frames - the longer-term performance comparative puts into perspective what my work continues to point towards:
Spot prices will likely start catching up on the downside.
* All stock chart data originally sourced and courtesy of www.stockcharts.com
- Subsequent overlays and renderings completed by Market Anthropology.
As I mentioned before, this is not an apples to apples comparison, but an expression of how a derivative sector capitulates - relative to its eroding and denominating backdrop. While the miners, relative to gold, are now searching for an intermediate term low - spot prices likely have a ways to go.