As noted in the previous update, the HUI sported a possible H&S bottom. With the impulsive feel to the break of the neckline, it appears Huey will now look to fulfill the pattern to at least the 210 level. Uncle Buck is trying to get comfortable in his new bullish suit, and with more and more of the herd buying the story, is ripe for a good correction. The yellow metal itself is strong as well and the Euro is due for some relief of its relentless dump.

The miners led gold's move by 2-3 weeks, and the dollar's move (if indeed this is the start of a dollar correction) by a month. So, rather than jumping perma-bullishly into the gold stock story, one might do well to trade (while holding any core positions deemed long term investments) the move. If HUI blows out 210 in an authoritative manner, we will have something else going on here. But for now, remember that you earned these profits and that this remains a tough and grinding market.

Chart courtesy of stockcharts.com