It has been a while since I posted anything on the technical trends (at least how I see them) in gold and the precious metal stocks. Lets look at gold, here as exemplified by the Gold Spider ETF (ticker GLD)/
First, volume levels since mid-May have been light on both the upside and the downside. This leads me to conclude there is either a general sense of disinterest from either bulls or bears or that traders and investors are sitting on the sidelines waiting for more information before putting bets on the table. That said, the RSI and MACD are showing some upward divergence versus the price. Although this may be a positive indication, it could also just be a function a time, still noteworthy though.
More importantly in my mind is the performance of the gold and precious metal stocks. The below chart shows the price and volume trends (along with other indicators) for the Market Vectors Gold Miner ETF (ticker GDX). What jumps out to me is the improving price performance of the GDX since mid-may. Price jumps that have come on increases in volume. In contrast, the recent decline has come on lower volume characteristics. This is a sign of accumulation in my book.
Additionally, the price/volume characteristics are also being reflected in rising trends in the RSI, MACD, stochastics, A/D, and money flow. These dynamics could portend to a coming turn in the price of the precious metal stocks.
This is important. My research has shown that the price performance of the gold stocks tends to lead the price of gold by up to six months. Rising gold prices could help support a sustainable rally in the precious metal stocks.
First, volume levels since mid-May have been light on both the upside and the downside. This leads me to conclude there is either a general sense of disinterest from either bulls or bears or that traders and investors are sitting on the sidelines waiting for more information before putting bets on the table. That said, the RSI and MACD are showing some upward divergence versus the price. Although this may be a positive indication, it could also just be a function a time, still noteworthy though.
More importantly in my mind is the performance of the gold and precious metal stocks. The below chart shows the price and volume trends (along with other indicators) for the Market Vectors Gold Miner ETF (ticker GDX). What jumps out to me is the improving price performance of the GDX since mid-may. Price jumps that have come on increases in volume. In contrast, the recent decline has come on lower volume characteristics. This is a sign of accumulation in my book.
Additionally, the price/volume characteristics are also being reflected in rising trends in the RSI, MACD, stochastics, A/D, and money flow. These dynamics could portend to a coming turn in the price of the precious metal stocks.
This is important. My research has shown that the price performance of the gold stocks tends to lead the price of gold by up to six months. Rising gold prices could help support a sustainable rally in the precious metal stocks.
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