I was asked, where do I sell gold/precious metal stocks

Where would I consider selling or trimming my gold and precious metal stocks? The answer, when my precious metal stock timing indicator went fully negative (i.e. when, at least, the 6-month timing indicator went above 2) or when the current rally slows or fails. I early trading, gold is trading above $1,690 per ounce and running these figures through my timing model still does not generate a hard sell-signal on either the 6-month or 1-year model. In fact, the 1-year model is still in a soft buy mode.

6-month model

1- year model

 

As for when the rally fails, my best guess is the $52 price level on the Market Vectors Gold Miner ETF (ticker GDX).

A Fibonacci analysis of the recent price shows the August 23 to August 30 pullback was about a 38.2% retracement of the broader move that began around August 2. Assuming self-similar and repeating patterns, this analysis suggests the rally will complete itself in or around the $52 price level or about 9% higher from last Friday's closing price.