Gold mining stocks surged higher as the Vaneck Vectors Gold Miner ETF (GDX) rallied more than 6% on Friday. Among the individual winning stocks were shares of Barrick Gold (GOLD), which traded 8% higher for the day.
The surge in mining stocks was driven by new all-time highs in gold prices. As of late Friday afternoon, Spot gold prices had increased by more than 3% to settle the day just below $3200.00 an ounce. That price represents a new all-time high above the closing price of gold on April 2nd, just prior to the Trump Administration tariff announcements.
Between the beginning of April and now, gold has put in a healthy 5% correction as investors were apparently taking the opportunity of the precious metal’s new highs to lock in profits.
Since the beginning of 2024, gold has given investors several opportunities to buy healthy corrections of 5% – 10% that always resulted in another 10 to 20% surge higher.
The same can’t be said for the gold mining stocks, which have seen much more volatility and much larger declines. Gold stocks are notorious for trading with much more volatility than the metals they are extracting from the earth.
In January, the shares of Barrick Gold formed a long-term bottom following a 25% decline from their October highs. That correction in the stock started when its 50-day moving average shifted into a bearish pattern in the closing days of October.
That same trendline recently shifted into a bullish pattern in mid-February as shares of Barrick Gold rallied from their January lows. Since then, GOLD shares have rallied 15% to today’s highs.
The shift in Barrick Gold’s 50-day has allowed the stock to form another bullish technical pattern that suggests even higher prices are on the way.
Last week, the stock completed a Golden Cross pattern as its 50-day moving average crossed above its 200-day moving average.
Barrick Gold’s last Golden Cross was followed by a 34% rally in the stock that started in early May 2024.
Options investors have taken note of the bullish signal in Barrick Gold as April and May call options have seen an increase in trading volume. Barrick’s call options are seeing volume that is more than four times the open interest focused on the $20 strikes. This suggests that options traders are moving to leverage a continuation in the stock’s rally.
With strength in gold and a bullish signal, today’s move above $20 is a likely precursor to a rally in Barrick Gold’s target price of $25.
— Chris Johnson
Put $1,000 into this stock now [Not NVDA] [sponsor]The legendary stockpicker who built one of Wall Street's most popular buying indicators just announced the #1 stock to buy for 2026. His last recommendations shot up 100% and 160%. Now for a limited time, he's sharing this new recommendation live on-camera, completely free of charge. It's not NVDA, AMZN, TSLA, or any stock you'd likely recognize. Click here for the name and ticker.
Source: Money Morning
