Monday, January 24, 2011

Could Gold Break Down or Bounce Like A Super Ball? (GLD)

Gold Futures Daily
The above chart you can draw many different conclusions from. The number one conclusion i draw from this chart is support @ the 1333-1330 levels. What makes this level worth watching is the prior nearly straight up trend from August until mid October leads up through this level. This level has been tested nearly 5 times the past 3 months only to result in a bounce up to near all time gold highs. The all time Gold was actually put in after a test of support, this high is 1432.50.

Will we see a bounce like we have seen in the past due to increasing dollar weakness and euro
strength?....or is gold's upward rise into the heavens going to be put on temporary hold as a test of 1250 comes quickly if support is breached? If Gold goes through support is hard to tell if correlation desks will  bring equities with it or not... my guess is the disconnects across assets are becoming more frequent and worth noting. Past correlations are not indicative of future results...

Be on your toes with this trade...