Gold stocks' make or break

Gold miners are struggling again today, and there has been a lot of internal deterioration there in recent weeks. It's gotten bad enough that now fewer than 40% of them have rising 200-day moving averages.

We saw before that when this figure has dropped after a plonged stretch of very positive readings, that kind of momentum has consistently - almost without error, actually - led to rebounds over the medium-term. So far, it's not taking.

The 40% threshold is a pretty good determinant of the market environment for gold stocks. If it hangs consistently below 40% and selling pressure comes in above 60%, it's unhealthy. If it hangs consistently above 60% and buying comes in below 40%, it's healthy. We're hovering on that precipice now.

Over the past month, an average of 80% of gold miners have been in bear markets. During anything but protracted downtrends, this kind of selling pressure has consistently preceded rebounds as well.

These stocks have not been acting well, and with some longer-term trend measures in gold now turning negative, it seems like an important juncture. Either they respond soon by stemming the declines, or the risk rises substantially that it will be better to sell the rallies than buy the dips in this group.