Once we broke support a few months ago in the metals market, I began pointing to much lower levels before we complete this larger degree 2nd wave within which we have been caught for the better part of two years. And, as we came into this past week, most of the metals charts we have been tracking were pointing down. In following through on those downside patterns this past week, the GDX finally completed the minimal wave structure we would need to see to even begin looking for a potential bottom as being struck.

Yes, that means that we can start looking for clues of the market having bottomed. But that does not mean that we have certainly struck bottom yet. Rather, it simply means that the GDX can finally prove it has bottomed with its next rally being impulsive, as we have enough waves in place to consider this multi-year 2nd wave complete. However, confirmation is now the key.

Yet, the individual charts I am watching are not strongly suggestive that the bottom has been struck. So, letís go through them individually.

In starting with the GDX, you can see that we have the minimal number of waves in place now to complete the green count on the 8-minute and daily charts. However, we will need to see an impulsive rally take us through the 18.60 level to even begin to confirm that a major bottom has been struck, and a multi-year rally has begun. Remember, should we only see a corrective rally, we can still even rally back towards the 20 region and still see another drop towards a lower low, as presented in the yellow count on the daily chart. So, the nature of the next rally will be incredibly important.

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