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Gold Wedged Between Support and Resistance

Commodities / Gold & Silver Jun 18, 2008 - 01:29 PM

By: Mike_Paulenoff

Very interesting situation developing in spot gold -- and by extension, the GLD (streetTRACKS Gold Shares). Let's notice that the price structure is wedge-in between the rising 200 DMA (support at $859), and the 50 & 21 DMAs (resistance) as well as the March-June resistance line all clustered around $900. My sense is that if gold hurdles and sustains above $900, gold prices could rocket towards $1000 again.

However, the 15 week cycle, which has proven to be a reliable turn projector, is not due for 2-3 weeks and warns me that perhaps any strength in gold here is a trap ahead of one more plunge into the cycle low timeframe- and another test of the 200 DMA? I really do not know, which is why I am on the sidelines in the GLD.

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By Mike Paulenoff

Mike Paulenoff is author of the MPTrader.com (www.mptrader.com) , a real-time diary of Mike Paulenoff's trading ideas and technical chart analysis of Exchange Traded Funds (ETFs) that track equity indices, metals, energy commodities, currencies, Treasuries, and other markets. It is for traders with a 3-30 day time horizon, who use the service for guidance on both specific trades as well as general market direction

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