I've never been a big pattern trader but there is an interesting one forming on the HUI chart.
The miners look like they may be in a megaphone type pattern. Usually these are topping patterns. I think this one will be a continuation pattern. Mostly because I don't believe this C-wave advance is even remotely close to being finished.
Now I don't know if the miners will move all the way down to the lower trend line or not. What I can say with a great deal of confidence is that if they do, the current optimism in the gold bug camp will turn to black pessimism.
That's probably exactly what we need to spawn the next leg up. If the HUI can tag the 360 level over the next few weeks and especially if the correction is extremely sharp and quick we will have all the ingredients (extreme oversold conditions & extreme negative sentiment) neccessary for a huge rally and breakout to new highs.
Once the miners join gold at new all time highs I expect we are going to see an incredible rally.
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