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Gold should not be up today, but it is. The strength of the dollar against the euro and the yen usually has a negative impact on gold, but something else appears to be going on that the price pattern and technicals are warning about. My pattern work argues that I need to treat the Feb 5 low at 102.28 in the SPDR Gold Shares (NYSE: GLD) as the end of a significant correction off of the Dec 3 high at 119.54. If that is correct, then all of the action since Feb 5 represents an “unwinding” into a new upleg that should thrust above key near-term resistance at 112.18 (from Mar 3) on the way to a revisit of 118-120 thereafter.
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!
