Planning The Next Reversal
Will gold press on to new highs?
We’re at a juncture with gold and the market itself, determines the next trading move.
From the chart of the Junior Miners, GDXJ, below, it shows a now obvious upside reversal from a spring condition.
That is, when price action penetrated weekly lows at the end of January, it set up possibilities for reversal.
Junior Miners, GDXJ, Weekly
In what should be a very familiar looking set-up, we can see GDXJ, is heading for a potential up-thrust condition (magenta oval).
As a reminder, this is what the daily gold (GLD) chart looked like back in September last year, before a similar (downside) reversal:
The resistance line is there, the wide (high volume) bar, everything.
Gold To New Highs ?
For the GDXJ set-up to come about, it would make sense that gold would head higher.
As stated, we’re already at the 1:1, measured-move, a-b-c, level.
It’s important to note, that level (GLD, 182.60) has not been breached. Today’s action could have been a test of the highs in anticipation of downside reversal.
However, there’s a Fibonacci projection slightly higher to the GLD 196, area … just above the all time high of 194.45, set way back in mid-August of 2020.
At this juncture, all short positions have been closed (not advice, not a recommendation).
It’s obvious world (and market) events are moving rapidly; the above analysis could be negated at the very next session.
Even so, it still provides a framework of what to expect should gold continue on to new highs … including the next target location, GLD 196.
Charts by StockCharts
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
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