The Gold Miners ETF (GDX) - Get Report finished Tuesday's session above its heavy 200-day moving average. A healthy bump in volume drove the index past this key resistance zone for the first time since mid-February. A number of large-cap miners, most notably Newmont (NEM) - Get Report, powered this impressive GDX move.

Newmont Mining has been tracing out what may soon develop as a major base since late February. The $32.00 area has provided steady support during this process, while holding the March, April and May lows. As the second half of the current consolidation began, the pattern turned much more positive. NEM is working on its second straight higher monthly low and has left behind a divergent MACD (moving average convergence/divergence) bottom. This is the formula for a fresh rally leg.

In the near term, investors should take a more bullish view of the gold miners. NEM is beginning to put some distance on multiple layers of support and is set up well for more upside. The 2017 high, set back in February, is quite a ways away but once past it, NEM has plenty of room to run. Until then, the stock is a low-risk buy between $35.00 and $34.00. On the downside, a close back below $33.50 would violate the June low, indicating the declining 200-day moving average remains in control of the action.

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At the time of publication, the author was long NEM.