Gold's run is almost done, according to gold trader Andrew Keene of AlphaShark, and he has just the way to profit from an expected slide in the precious metal.
The yellow metal has had an incredible year, and that has sent most gold-mining stocks soaring. But with market uncertainty appearing to settle amid the post-Brexit vote rebound, Keene thinks the metal is due for a turn lower.
Keene has picked one gold stock that he sees following an expected downtrend for the metal in the coming months. Barrick Gold (ABX), the world's largest gold-mining company, has seen its shares on the rise since September of last year, following the gold rally. While ABX looks set to keep rising in the short term, Keene believes that investors need to look further down the timeline where the stock could head down if gold were to slide.
"Gold stocks have been on fire," said Keene on Wednesday on CNBC's "Trading Nation." "I think they will pull back, but I want to give them a little bit more time than just July."
Keene looks at both daily and weekly charts of ABX to determine where the stock could go. In the short term, Keene points out that the stock is seeing a "clear bull channel," but he says that based on its relative strength index, "I think ABX might have hit a top here, and I think it's going to sell back off."
"I'm thinking that's the test, around the $19.50 and $20 level, and then I think this can eventually get to $17."