The iUnits S&P/TSX Capped Gold Index (XGD.TO) closed yesterday at C$75.50.

I wrote it up in a mid-May WIR report when I called the top.

The TSX goldminer fund has really fallen hard in recent weeks. It thought it might stop when gold dropped below 660, so I said I would nibble for a short life trade, which worked out in spades for Glamis (GLG) and to a lesser extent for Goldcorp (GG/G). Then I got out " took my profits, thank you, because I could see the growing possibility of more selling. That too has happened.

From the following WIR (May 27):

Gold: $GOLD gained +0.6 pct on Friday, which meant the loss on the week was only -0.8 pct. This is a tough call, but I think the odds are in favor of gold sidetracking here. A cycle low of $637.50 was hit Wed, and the 50d MA is 627.61 (and rising), so there is a measure of support here. But with the Indian (and Middle East) equity speculators getting whacked, I can't see them chasing gold right here ($653.80).

Goldminers: The U.S. goldminers index did rally +1.82 pct W/W to close Friday at 142.59, a similar move to the Cdn goldminers. While I think the recent low of 133.13 is the cycle low for $XAU, this index is susceptible to being tested further on the downside. I may hang in for a week or two (except GLG and GG/G, which will now go to USGL), but I don't expect the summer rally to start yet.

And then I caught the USGL for a huge move over the next several days.

If you look at the chart at Yahoo Finance, XGD has a good base between 66 and 73, and closed yesterday at $75.50. So with gold being crunched in recent days, and the miners holding tough, I feel we are close to a buying point on these goldminers. I might be nibbling again today. We'll see.