Looking at bullion and miner charts, the selling pressure has pushed down the relative strength of gold and gold miner ETFs into oversold territory for the past couple of weeks.
“This is a hurricane 5 in terms of the depth of the capitulation for the gold miners,” McDonald added. “The amount of people that have sold the gold miners in the last week are more than double the amount of shares outstanding.”
Market Vectors Gold Miners ETF
For more information on gold producers, visit our gold miners category.
Max Chen contributed to this article.