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As spot gold hits the next optimal target zone around $1172, let's look at the big picture of the SPDR Gold Shares (NYSE: GLD). The next optimal target zone off the big base formation in the GLD is 117.00/50. If no profit-taking and/or corrective action occurs in and around 117 (give or take a couple of dollars), then the concept of “vertical blow-off” gets into full swing, with a potential next target of 128-132. At this juncture, only a bout of weakness that presses below 112.50 will trigger initial warning signals that perhaps the 117 area in fact is a near-term lid on the market. Furthermore, a decline that breaks 109.50 will confirm that a significant price peak has been established.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
