The chart above reflected what looks to be a Power of the Pattern opportunity at hand. The 2 charts above are both "monthly closing charts." The chart on the left is the Gold/Silver Index (XAUO and the chart on the right is the Market Vectors Gold Miners ETF, (GDX).
The above chart reflects the Gold Bugs index and the S&P 500 in the top half, the bottom chart is the gold bugs/spy ratio, reflecting that it has tanked over the past couple of years, creating a "Fish Mouth Spread." This is a situation where rallies in the Gold bugs index have often taken place in the past, at least since 1998.
Of note...the gold bugs index was oversold in 2000, when SPY was overbought. What followed was a huge rally in the Gold bugs index and a 50% decline in SPY. Current readings in the ratio are the lowest since 2000. Could a rally in the gold bugs and a decline in SPY take place again? Stay tuned!