Mr. Market does not believe Mr. Benanke and continue the down trend after rejected at the down trend resistance line. In addition, GLD broke the critical support of $130 and in the process of forming a Head and Shoulders pattern. Watch the neckline support (also the 61.8% Fibonacci Retracement) at about $124-$125. Breaking this support will send GLD to test the recent low of $115.
See Previous Analysis Gold Starts to Rally?
Gold Start to Rally? Yes. At least for the short term base on technical analysis because Gold has just broken the previous support turned resistance. Looking at the GLD (SPDR Gold Shares ETF), GLD has broken the $130 critical resistance level and also moving above 20D / 50D SMA. Base on the past few months chart pattern, 20D SMA is a reliable support and resistance moving average line. The price target for this GLD rebound is about $139-$140 region base on 161.8% Fibonacci Expansion Level by mid Oct 2013 (using Fibonacci Fan).
Statistically Aug and Sept tends to be bullish months for Gold. See statistical table here.
Looks like the recent rebound of GLD is coming to an end as the ETF price is facing the Fibonacci Fan 38.2% resistance and the gap resistance at about $125. GLD has been rejected by this 38.2% Fibonacci Fan resistance for the past 2 occasions.
The current rebound has retraced back to 50% FR level (see Fibonacci Retracement in black line). Keep an eye on whether there is a reversal at this level else GLD will continue the down trend from now on.
See GLD previous analysis here.
