GDX remains in an incomplete bearish sequence that began at the 2 March 2026 high, with the decline still described as an impulsive move followed by corrective phases. Downside risk is framed by a 100% to 161.8% Fibonacci extension from that peak, setting an objective target zone of $33 to $59. This area is presented as a support region where a three-wave rally could develop at minimum, while the near-term cycle from the 18 June high is still unfolding as a zigzag.
From the 18 June pivot, wave ((i)) ended at $84.28 and was followed by wave ((ii)) at $87.21, before wave ((iii)) moved down to $74.08 and wave ((iv)) rebounded to $76.40. Wave ((v)) then reached $73.70, completing wave A at a higher degree. From that low, wave B formed as a double three: wave ((w)) rose to $78.48, then wave ((x)) dipped to $73.89, before wave ((y)) advanced to $80.47; the decline has since resumed, with $90 cited as the key pivot.
Technical and Macroeconomic Drivers Signal Further Downside
We see the bearish sequence in the Gold Miners ETF (GDX) from the March 2, 2026 high as incomplete, pointing to further downside in the weeks ahead. The structure of the decline reinforces our view that a durable bottom has not yet formed. As long as prices remain below the $90 pivot, our bias will remain firmly bearish.
This technical outlook is supported by a strengthening U.S. Dollar Index, which recently climbed to a five-month high of 106.5. The Federal Reserve’s June minutes, released last week, also revealed a consensus for holding interest rates higher for longer, pushing the 10-year Treasury yield back to 4.5%. This macroeconomic backdrop is historically challenging for gold miners, as it makes non-yielding gold less attractive.
Trading Strategies and Supporting Data
Given this view, we believe traders should consider buying put options to position for a move lower toward the $59 to $33 target zone. This strategy offers a clearly defined risk and direct exposure to the anticipated decline. We would favor expirations in late August or September 2026 to allow sufficient time for the next leg of the bearish sequence to play out.
For those with a more conservative risk appetite, establishing bear call spreads is an attractive alternative. By selling a call option with a strike price near recent highs and buying a further out-of-the-money call for protection, traders can generate income. This position will be profitable if GDX moves lower, sideways, or even rises modestly, as long as it stays below the short strike price through expiration.
Our conviction is strengthened by the latest inflation data, with the June 2026 CPI report showing a continued disinflationary trend at 3.1%, reducing the immediate need for gold as an inflation hedge. We have also seen a notable rise in the GDX put/call ratio to 1.25 over the past ten trading days. This indicates that options market participants are increasingly positioning for a drop in price.
