Monday, May 5, 2014

GLD weekly chart is interesting and less horrible than you'd think

Here's the GLD weekly candles:

So look at the right side of the chart. Here's what I find interesting:

1. there was a pop from December to March. This took GLD over the 50-week SMA, which is good.

2. the pop failed, and the price dropped back down; but it only fell as low as the Bollinger mean. It fell intraweek below the mean a few times, but always ended the week back above it. During all this time, the price basically consolidates between the Bollinger mean and the bottom of the SMA(50), almost as if gold was trying to build strength for another pop. This despite selling outnumbering buying in this period.

3. the triangle between the Bollinger mean and SMA(50) is closing off this week (only $1.04 separates the two), and with room running out, gold has decided to pop above the SMA(50).

I have no reason to like gold, because India may have a weak monsoon this year and China might be running into debt trouble, and that's where gold is bought.

Then again, if some retail clown like me knows this, the rest of the market already knows it.

So really, I have no reason to like gold, except the chart suggests that the rest of the market might start liking it soon.

After all, it's not like supply and demand are the sole determinants of commodity prices, is it?

Not really into buying much right now, but darn it all this chart makes me want to pay attention.

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