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SPDR Gold Shares Message Board

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  • keybotthequant keybotthequant Aug 10, 2011 8:59 AM Flag

    Latest Gold Charts

    Gold touched 1781 after the Fed announcement yesterday. Note the channels showing the move up in three stages; gradual up, accelerated up, and now parabolic. The RSI sneaks ever so slightly above the prior high four months ago indicating that price will want to come back up again to these current levels or higher, after a pull back occurs. Ditto the MACD. The red lines for stochastics and money flow show negative divergence and should create a pull back now.

    Of interest is that looking back to study the three year gold rally, the daily chart is negatively diverged across all indicators favoring a pull back in price. By considering the topping action on the weekly chart, the projection is a major top for gold over the next month or two. The move down may be initiated by an increase in margin requirements.

    Conversely, the recent strength has to be respected. Many traders now talking of the inflation-adjusted targets of 2200 or 2400. Backing off of that using Keystone's 80-20 rule says that if 1800 is achieved, the trip to 2200 would be likely. Further, a close above 1780 would lead to 1820, thus, the 1780+ level is a gateway to the higher prices. A potential close above 1780 requires close watching over the next few days.

 
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