“The truth is incontrovertible. Malice may attack it, ignorance may deride it, but in the end, there it is.”
No matter what one may think about Churchill, the truth at this juncture for gold (GLD), is an island gap reversal:
‘There it is’
Longer term momentum indicators, MACD, are pointing higher on both the monthly and weekly.
So, there’s definitely some upward bias.
The ‘Next’ Catalyst
We’ve already had military attack, bombing of a nuclear power plant (so they say) including the actual threat of nuclear detonation … so what’s next?
The (fake) alien invasion?
What if aliens really do invade? My first thought of course will be, “I’m glad I have my stack of gold and silver to get me through. I feel much better.”
No, let’s get real.
We’re all going to wish we had a ‘Ma Deuce’, like this one.
If you’ve got one of those, you can have all the gold and silver you want … plus a few aliens to boot. 🙂
Hyperinflation, Here, Now?
Well, there’s at least one way to tell and that’s by the price action itself.
The daily chart of gold tracking fund GLD below, clearly shows the island gap.
Even with all the upward bias on longer-term momentum (MACD) indicators, if GLD can’t fill that gap, there’s something else at work.
On a closing basis, GLD is still below all-time highs, set back on August 6th, 2020.
With the climactic volume and price spike discussed previously, short term expectations are for some type of (continued) downward retrace.
Then, There’s This
It’s still about four hours to go before the Sunday futures open and anything can happen.
For now, this news headline suggests a lower open for gold.
If gold opens lower, does the market (S&P) open higher or will there be some kind of ‘excuse’ for lower as well?
Lastly, the Fed is (supposedly) shorting S&P, Calls.
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.
The Danger Point®, trade mark: No. 6,505,279