Gold Bubble Weekly Update #5

Disclaimer: This is not meant as financial advice and is for entertainment purposes only.

Last week I was watching the S&P 500 closely as it broke down through support. I called for a $2,530 retest and didn’t expect it to hold for a third time. To my surprise the price reversed at $2,550.

It is now testing $2,650 resistance and I would like to see it close below that.

What’s very puzzling is that Gold is rallying right alongside the S&P. Historically those two have an inverse relationship and I expect that to resume very soon.

1 month chart

Last week we were building momentum and I expected a retest of the crucial $1,355 resistance. Instead we have pulled back and are looking at an unfavorable bearish wick. The RSI remains above 50 and there is still plenty of time left in the month for the bulls to turn it around.

1 week chart

That is an ugly wick that closed on last week’s candle. I am surprised it didn’t provide the bears more momentum heading into this week. Instead we found support at $1,325 and formed a higher low. The RSI stayed above 50 and formed a higher low as well.

Daily

The candle from 4/4 is about as ugly as it gets! Again I am surprised it didn’t give the bears more momentum. Support at $1,320 is very good sign and tells me that the sellers must be getting exhausted. RSI is back above 50 as well.

Overall things are still looking good. If we continue to consolidate above $1,330 then it is only a matter of time before $1,355 resistance falls. Once that happens it is game on!

Click here for last weeks post.
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