Gold GLD ETF Surges, But No Breakout
Commodities / Gold and Silver 2012 Jun 01, 2012 - 04:13 PM GMT
GLD surged nearly to its former Head & Shoulders neckline and 50-day moving average at 157.76. Normally I would have taken some of our position off the table if GLD had closed above short-term trend support/resistance at 152.61. This case, however, was out of the blue. I think that since Goldman was selling TLT, it decided to try GLD as the new “safe haven.”
This is an excellent place to add short positions to GLD with a stop loss just above the 50-day moving average (possibly 158.50-159.00).
SPY seems to be testing mid-Cycle support and the lower trendline of the red Orthodox Broadening Top at 129.10. Overhead resistance is at the neckline at 129.55. It appears that the decline isn’t over yet, so we wait for a further breakdown this afternoon.
UUP has been retesting its neckline this morning and may be ready to resume its rally. On the opposite end of the scale, FXE is bouncing above its low in a brief correction as well.
USO took a big hit today. It may linger beneath Cycle Bottom resistance for the rest of the day, but the more likely outcome is a resumption of its decline toward its new Head & Shoulders neckline at 29.10. There are two weeks left in this declining cycle, so we may see a huge decline in the price of oil.
Regards,
Tony
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