Conclusion, Investment Implications, Strategy
The iShares MSCI Global Gold Miners ETF (RING) is in the midst of minor and major bullish price trends while also amid a March 16th trend of Strategic (quarterly) relative outperformance versus the benchmark S&P 500 (SPY). Meanwhile, the total net assets invested in RING are in the midst of a March 17th emerging trend of Tactical (monthly) expansion. These three factors (positive trend, relative outperformance, expanding investor assets ) indicate favorable conditions for RING to continue rising in the weeks and potentially months ahead.
Current Sector & Industry Group Ideas
Table 1 below is an updated version of Table 2 that appears in our weekly Keys To This Week: Sector & Industry Groups report published on Monday mornings.
This table is also accessible via the Sector & Industry Group Ideas rectangle at the top of the Research Center.
Analysis and Rationale
The iShares MSCI Global Gold Miners ETF (RING) generally will invest at least 80% of its assets in the component securities of the underlying index and in investments that have economic characteristics that are substantially identical to the component securities of the underlying index. The index has been developed by MSCI Inc. (the “index provider” or “MSCI”) to target a minimum of 30 companies in developed and emerging markets that are involved in the business of gold mining. The fund is non-diversified.
The upper panel of Chart 1 below plots RING daily since January, along with its 200- and 50-day moving averages, widely-watched major and minor trend proxies. The lower panel plots the corresponding daily relative performance of RING versus the SPDR S&P 500 ETF Trust (SPY) along with its 63-day moving average, which we use to identify the Strategic (quarterly) trend of relative performance versus the broad market.
The upper panel shows that RING rose above its 200-day moving average on Mar 13th to indicate the resumption of its January major advance, and also its subsequent rise above its 50-day MA to also indicate a bullish minor trend change. Minor support exists at 23.37, the current location of the 50-day MA.
The upper panel of Chart 2 below shows that RING successfully tested its 200-day moving average as major support twice, on Feb 24th and Mar 9th, before resuming its major uptrend as defined by its 200-day MA.
The lower panel plots the daily total net assets invested in RING since January, along with their 21-day moving average, which we use to identify a monthly trend of expansion or contraction. The green arrow points out that these assets are in the midst of a Mar 17th emerging trend of monthly expansion that is characteristic of Tactical price advances. As long as these assets remain in monthly expansion, the current rebound from the 200-day MA in RING is likely to continue.