Given that the Gold ETF tends to trade inversely to the general market, it's not surprising that it had a poor day today, down -0.8% while the XAO was up +0.9%.Whether or not the two march in a direct inverse manner is not so important as the general direction.
I've put up a weekly chart of the Gold ETF to concentrate on the bigger picture and get some idea, by implication, about where the general market might be headed.
The general market began its current medium term up-trend at the beginning of December.
The Gold ETF has been in a down-trend since the beginning of December.
So far so good. That's the way the world should be working.
We can see now that the Gold ETF is sitting on the 65-Week Moving Average. That may or may not be significant in itself. But it is also associated with a rising oblique up-trend line from late 2009. The Williams %R also suggests that it is now very oversold.
The last two candles are "biggies" - and the volume associated with them has broken above a down-trend line from the highs in the middle of the year.
Volatility in price and volume are rising.
A break downwards here would probably see much bigger falls in the near future.
But, given the oversold nature of the market, I think the probabilities lie to the upside for the Gold ETF - and to the downside for the general market.
Good luck
Red
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