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Wednesday, December 5, 2012


I wonder why the big gaps down in GLD.  Here is the daily chart.

In the last GLD and GDX report I said

This looks more like a corrective move to me rather then the start of a real rally.  Price crossed the 50 SMA to the upside, but did not confirm the break above.  Today it closed back below the 50 again.  It never quite hit the 200 SMA or the green uptrend line on the big decline.  I think this might have some more down side testing to do.  I will be watching to see if it breaks the blue lower trend line. In that case, I would like to see a hit of the green uptrend line which is around 164 at the moment.

We hit that trend line this morning.  I did not expect to hit it quite so fast, LOL.  This is a bit problematic.  The price is stretched in the short term and at possible tend line support, but this is not any kind of pattern that I can say this is an important bottom yet.  GLD could bounce a bit and roll over to test the Nov. low or the 200 SMA below that.  If you want to try and catch a low here, today's low should make a reasonable place to put a stop under.  I think I will wait a bit to see how it shakes out.

Next up is a look at the GDX daily chart.

GDX may be working on a double bottom.  The volume pattern looks good in that volume has fallen on this retest of the low.  This looks promising, but it is too soon to say we have made a low.  It is still a bit unclear to me what GDX is doing long term.  I would have preferred it made a low somewhere above my green line that should have been support.  This may all just be part of the bottoming process, but it is a bit foggy looking.

Both of these ETFs are getting into areas of interest.  However, it is too soon to say we have hit bottom.  It is time to pay closer attention to them though.


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