I am going to keep this brief, as Rosh Hashana just ended and I am going to be leaving for North Carolina.
But, needless to say, the only prayer the bulls have now is a leading diagonal. And, if is that is what your primary trading plan is based upon, then I suggest you stay very close to your screen, as you may have to adjust rather quickly.
First, as many of you know, I do not rely upon leading diagonals for strong trading cues since they can just as easily be a corrective structure. And, even in this case, we would still need a high over last week’s high to even consider such a potential.
Second, in GDX, I can count a micro 5-wave decline off the high struck last week. That means we have a potential i-ii, [i][ii],  downside structure now in place. And, if we remain below last week’s high and break down below 31.30, that opens the trap door, and the drop through that door can be quite dramatic and rapid, as it would be the heart of a 3rd wave to the downside based upon my count. The target for that wave [iii] of iii would be in the 25.70-26.75 region.
While silver did have a strong potential to break out and complete a 5-wave structure off the recent low, this overlap has certainly caused the bullish count major problems as well.
And, as far as gold goes, I can even make the argument for an initial 5-wave decline off last week’s high as well. But, it really is not very clean.
The summation of analysis leads me to strongly caution all of those who are retaining a strong bullish bias. The GDX is postured for a strong break down if it is not able to exceed last week’s high before it breaks down below 31.30. And, I would not be at all surprised to see the metals decline along with it.
To use another sports analogy, it is the bottom of the 9th, there are two outs, no one is on base, and GDX is down by 4 runs. So, bulls have a LOT to prove to me at this time. And, as long as we remain over 31.30, at least they are still in the game.