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SPDR Gold Shares Message Board

  • keybotthequant keybotthequant Nov 29, 2011 9:11 AM Flag

    Gold Weekly Chart Testing 20 MA

    The rising blue wedge, overbot conditions and negative divergence shown by the red lines sealed gold's fate three months ago. Price dropped dramatically but the 20 week MA and neon green lower trend line craddled price and bounced it back up again. Now a pink sideways triangle is in place with price having to make a decision on a direction at any time. This week, price has tested the underside of the 20 week MA in the 1710-1730 area. This back kiss is critical. Price failure here opens the door to much lower numbers moving forward. If the gold bulls want to regain control it has to be here and now.

    If the RSI drops under 50%, the stochastics already have, the gold bears will be winning and the back kiss of the 20 MA results in failure. The projection is lower prices moving forward for the months ahead. The 1580-1600 area is particularly interesting where sturdy horizontal support exists forming a confluence with the upward moving 50 week MA. The 65 week MA, shown on a previous chart a few posts back, serves as a magnet for price and it is now printing 1513.

    In the days ahead, watch the 20 week MA test, the RSI 50% level, the pink lower trend line, the neon green lower trend line and if the money flow drops under the orange support line; these tools will tell the tale on gold as December plays out.

    For GOLD chart use search box above for keystone speculator.

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    • Here is an update for the gold daily chart.

      The gold daily chart is building a triangle out sideways with price staying within the boundaries. A move will occur out of this triangle and the move should equal the length of the veritical side, say 350 points. Thus, a move favoring bulls out the top at 1770 would taget 2120, interestingly, the 2200-2400 area is the inflation-adjusted high from years ago. A move out the bottom at 1680 favoring gold bears would target 1330. The importance of the coming break out move cannot be overstated.

      The low stochastics and money flow gives the bears a slight advantage since these indicators are acting like a weight hanging on price trying to get it to fail the lower rail. That 1725-ish center line identifies the 20 week MA level which the weekly chart is fighting at currently. Bulls can become happier if they see the RSI regain the 50% level. Projection is for price to fail out the bottom of the triangle and head sideways to sideways down moving forward. In addition, watch for any potential fake out move which occurs from these triangle patterns so which ever way price breaks out, pay attention when the back kiss occurs.

      For GOLD chart use search box above for keystone speculator.

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