SPDR Gold Trust (ETF) (NYSEMKT:GLD)

CAPS Rating: 2 out of 5

SPDR Gold Trust (the Trust), formerly StreetTRACKS Gold Trust, is an investment trust. The Trust holds gold, and from time to time, issues SPDR Gold Shares (Shares) in Baskets, in exchange for deposits of gold and distributes gold in connection with redemptions of Baskets. A Basket equals a block of 100,000 Shares.

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Player Avatar Acolin (47.58) Submitted: 12/31/2012 12:22:06 PM : Underperform Start Price: $161.25 GLD Score: +75.86

Only a serious break and hold below $1,600 would change Gold’s roaring BULL into a sluggish bear. In fact, that may be happening now. The weekly Comex Gold chart forced itself in a corner in the summer of 2012, broke-out higher, but failed to make new highs. Now the weekly EMA is SIDEWAYS, while the daily chart is very BEARISH and testing a double-bottom at $1,640. Technical indicators are that the market is oversold, but the short-term trend is DOWN.
The decade long climb in Gold accompanies a decade long slide in the US dollar. That slide halted and reversed with the financial crash of 2008, not only because the Federal Reserve secretly injected trillions into an illiquid financial system, but because the US dollar index (USD) also suddenly became the ultimate safe haven of choice for dozens of other faltering currencies. The USD has stopped going down compared to its trading partners. In the last four years, USD has climbed from below 75 to trend SIDEWAYS at 80% compared to other popular trading currencies. Gold is suddenly faltering.
A bounce back on the daily charts to recover $1,700 territory seems likely. So does a failure to keep and retain previous highs. Failure to re-take and hold previous highs will quickly turn the mid-term charts BEARISH. Just a few weeks of this sideways to down action suddenly turns the long-term bull into a bear.

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