Where Gold Is Headed $1,000 or $750?
Aug 1st, 2008 | By Lynn Carpenter | Category: ETFs, Gold MarketLong stuff up there on gold, so I’ll make this short. Where’s the shiny stuff going? Back in January, I told my Rising Tide readers that the Streetraks Gold ETF (GLD) was a smart buy. It’s certainly hit new highs since… and I think gold is an asset with long-term value for a bit of money. But…
I don’t see it flying to the moon in the next week or two. In fact, it’s at a critical point just looking at the chart. The price of the GLD fund is exactly 1/10th the latest price of gold, so when GLD is at $90, it represents gold at $900, for instance.
Fundamental reasons such as scarcity are another matter. And there’s no telling if something disruptive in the news will notch up fears about the dollar or other assets, which favors gold. But technically, gold has settled into a range lately. Just for fun, what does a simple reading of a chart’s trend lines tell us?
The danger now is that its recent weakness grows and GLD falls through the short-term bull support line (the blue one from August 07 to present). If it does, its next target is down to $75. That translates to $750 gold. But the longer GLD stays above $90, the stronger it gets.
Meanwhile, advancing will take some work because bear resistance is building up overhead. That pushes to keep the price down. But if GLD does break through that mean green line, we could see fireworks again.
Here’s what to watch for: If GLD hits $97, closes above it and follows through immediately to stay above that level, we’re in for another run. Turn in your Confederate dollars and buy gold.
Source: Where Gold Is Headed $1,000 or $750?
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Lynn Carpenter is a contributor to Investor's Daily Edge.
Nice article, but didn’t they change the name of GLD to SPDR Gold Shares effective May 21st? There was a mention of this change here http://www.etfmarketpro.com/GLD-SPDR-Gold-Shares.html .