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GLD: Technicals
In previous articles, I provided fundamental and some technical evidence that not only is the gold bull market intact, but that the fundamentals for higher price appreciation remain strong as well. Yes, there has been some technical damage, and yes, it is enough to warrant caution. On the other hand, investors need to remain alert as these kind of buying opportunities don't come along all too often in a bull market. In this article, I will take a look at the technicals of the SPDR Gold Trust ETF (symbol: GLD) utilizing long term monthly charts. In follow up articles, I will drill down on the weekly charts to determine where the stress points will be and where a buying opportunity might develop.
Figure 1 is a monthly chart of the GLD. Since 2008, GLD has been in a strong uptrend, and price still remains within the uptrend channel. 5 months ago, price did try to break out of the channel (blue up arrow) and go parabolic, but that failed move (red down arrow) led to the current price action.
Figure 1. GLD/ monthly
Figure 2 is another monthly chart of GLD, and this time I have added some negative divergence bars (pink labeled). In this instance, these are negative divergences between price, which is heading higher, and an oscillator used to measure price, which is headed lower. While negative divergences are often seen at market tops, their presence does not guarantee a market top. (Read the last sentence again because most technical analysts types don't understand that concept.) My research shows that negative divergence bars imply slowing upside momentum, and the highs and lows of the negative divergence bar will often serve as the highs and lows of a range that follows the negative divergence bar. So you get a negative divergence bar; price momentum slows; subsequent prices are contained within the highs and lows of that price bar until you get a break out from that range. And this is what I have tried to convey with the gray boxes on figure 2.
Figure 2. GLD/ monthly
Several caveats. Look closely at the 8 negative divergence bars on this monthly chart. In 7 out 8 instances, the lows of the negative divergence bar were tested but price never closed below those lows on a monthly closing basis. The recent negative divergence bar has a low of 154.19, and it would be my expectation that prices will close above this level by month's end. The high of the second most recent negative divergence bar is 151.86; this would be considered a support level. Last week's sell off low: 151.71.
Going forward, it is my expectation, based upon the failed breakout and the clustering of multiple negative divergences, that GLD will remain in a range bound period for a while. If prices fall out of the trend channel line or below 150 ~ ish, then all bets are off. If this analysis is wrong, then bull market is really over.
On the other hand, I really do like the fact that the fundamentals for gold have not changed, and prices are sitting at support as defined by a long term rising trend channel line and by the highs and lows negative divergence bars.
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Investors are furious that they can't get back the gold and silver they stashed with the failed brokerage.
It's one thing for $1.2 billion to vanish into thin air through a series of complex trades, the well-publicized phenomenon at bankrupt MF Global. It's something else for a bar of silver stashed in a vault to instantly shrink in size by more than 25%... more>>
So, what would it mean if there was actually 10 times the amount of physical gold in the world as "common knowledge" usually indicates? Would that change the price?
I read an article the other day indicating that was true.
Remember the famous Rule of Gold Trading: In the hold of every sunken ship, you will ALWAYS find a chart.
Buy breakdowns; sell breakouts - only in rigged markets.
Author: Julian Phillips
You might want to look at Theodore Butler's latest. In my opinion there are some reah rehypothecation shenanigans and definite use of gld and slv going on as the strong unleverage want their physical gold and silver and the rules where the metals are stored, mostly in the UK are a free for all.
SLV Short Position UpdateWhen is someone going to admit that you can't predict future prices based on past performance. Charting is ridiculous.
I used to sneer at technical analysis also until I figured out it is an art not a science.
And it's paper gold...just try getting same day delivery for those prices retail.
not going to happen.
I can get you $40 over spot for 1oz...cut the bullshit
$40 eh? Sounds like you cut through the bullshit and got some on your sleves.
Freedom!!!
Support free markets, don't buy CDOs on commodities --period.
The financial oligarch's take the money, invert it, scale it up and use it to manipulate what's left of the commodity markets and means of production. Smoke and mirrors.
Gold is a real money for savers. GLD is a bankster scam. Don't be the last one to figure that out.
Buying physical give Wall Street the Finger and it takes your money off of the digital radar! Found this site on Turd's site yesterday...great for checking dealer prices.
Comparegoldprices.com
Thanks for the link. A useful handful of info on the big dealers. Here's one for checking the eBay prices:
http://www.goldprice.org/ebay-gold-prices/
I still have a few blocks of copy paper laying around. So if anybody feels like paying 1500$ per page, just give me a sign.
HECK! I MIGHT EVEN SELL IT FOR 1450$ PER PAGE!!
Do they have GOLD written on them in crayon like the ones the banks have?
I would never take any action based on what a central bank does to the paper price of gold on a short term basis--except buy more.
No matter what, gold is used a reserve asset in global Central and Treasury banking. If the Fed ever took gold under the 200 DMA, it would implode the global debt situation. Gold is the only asset backing any sovereign debt anywhere on the planet, and it makes more sense to run it up than run it down. Gold remains the ultimate financial asset. And in case you have not noticed, every time the price has been punched, the system starts cracking up again. It is not a coincidence.
.
Could this be an inverse 'dead cat bounce'?
APMEX is "BUYING" at $1645 and selling at $1705 There is a disconnect between paper and the physical
huh? No they aren't, you moron.
The wholesale price of sovereign mint coins is NECESSARILY higher than spot and what you have cited was Apmex's BID/ASK spread.
Cut the bullshit
The smiley yellow man is right - they're offering kilo bars at around $20 over spot...
http://www.apmex.com/Product/11934/1_kilo_3215_oz_Gold_Bar___Mint_Varies...
1.2% ... not exactly what I'd call a large disconnect between paper and physical.
Shocking! Nobody could have called that. Nobody.
Here's a word for ya
hyper-hypothecation
But you can print unlimited GLD. Gold is metal.
That is why it is most important to hold physical gold and keep it stored under your control.
Fiat currencies are being created on a daily basis in amounts so large that the human mind can not really understand. As far as I know, nobody can create more gold.
My analysis: GLD to zero when hedge funds realize there's nothing in the vaults backing their paper.
For some, I guess, MFG wasn't a wakeup call.
No doubt that if it were closed-end it would already be trading at a discount to NAV
It is already known there is nothing in the vaults backing the paper. Come on Sheeple, get beyond that notion and start thinking like the Criminals running this show. I tend to believe there are no surprises and
http://youtu.be/6GLqcbpm1qE may be right on the money.
Interesting in the that drive up seems to be mostly by comparitively small volumes. A large volume up is oft followed by a large volume down. then the small volume ups start a uptrend sequence.
"I say Jeeves it looks like there is a fox in the hen house."
OMG! You haven't heard? Paper is DEAD!
Other irrelevant things in the paper gold and silver market:
1. charts
2. ratio of fiat to gold/silver
3. counterparties
4. Fort Nix
Physical only !!!!!!!!!!
"I will take a look at the technicals of the SPDR Gold Trust ETF (symbol: GLD) utilizing long term monthly charts."
posted by thetechnicaltakeyourphysicalandgiveyoupaper.
"takeyourphysicalandgiveyoupaper."
Worked for FDR, didn't it?