Short Squeeze

Finally we are getting the short squeeze in equities I expected in the beginning of the week. The Future led buying helps all sectors across the board in Europe. The most interesting sector to watch is Gold, where GDX is heading towards a major break out at USD 55. The pattern looks like a cup and handle and all technical Indicators favour a move above USD 55 right now. In the premarket, GDX trades at 54.51 right now, up 90 cents, but only 8000 shares changed hands.






If you are desperately looking for exposure, I would prefer a defensive sector. Looking at Sanofi in France, the company is still struggling to buy Genzyme Corp. in the U.S.If this deal would be a big positive for the company remains to be seen. What I can see from here is that the stock is moving out of a falling wedge, challenging resistance at EUR 46.5, where you can also find the 50 day moving average. A break of EUR 46.5 would give a clear buy signal.



Traders should not chase the rallies at this point, because chances are high that we witness only a rebound from the obvious support in the S&P at 1040. But keep GDX & SAN on your radar.