I am, also, looking for a rebound in pm shares but I am not too sure concerning the timing of this. I have noticed five days ago that the Gold/XAU ratio has turned up in favor of gold versus the pm shares on its chart. Gold remains in a strong position to outperform the stocks going forward. The flip side of this may not take place for a period of months. So, for the pm shares to really excel we need the ratio to go positive for the shares which hasn't happened yet. I'm not saying the pm shares can't go forward, I'm just saying the bullion will be the better relative strength performer.

The most overwhelmingly powerful influence on the group remains that it was damaged greatly with the paper share sell-off during the month of October. Although most of the damage was quickly reversed in the major golds they still need more time before they can get back to business following and anticipating up moves on gold.

During the robust rally that took place from the October lows both the HUI and XAU Indexes were stopped dead in their tracks by important moving average lines which have been discussed before. This is a sure sign that they are temporarily exhausted. On the downside, the XAU at 117.55 could bottom out as low as 100 but it would be nice if it does it higher. The CDNX Index is doing a great job holding above it ascending 50 day moving average line at around 846 and will be a factor in supporting the juniors and explorers.