Divergences, What Happens Next?

Is gold about to blow up?

Blow-up breakout? … No, blow-up breakdown.

As we’ll see in the chart of GLD below, double bearish divergence on the daily.

At time stamp 6:10, here, in the Fed’s own words, rates are not coming down, they’re likely to go higher.

‘We will need to increase the Fed’s funds rates further …’

Not forgetting bonds, may have already reversed, here.

Then, liquidity crunch … yet to appear in full force.

Next, a reminder, herd instinct is strong, link here.

Gold GLD, Daily

On a daily basis, we have a double bearish MACD divergence coupled with a terminating wedge.

As veteran trader Richie Naso says, ‘It’s all about patterns‘.

Let’s add intrigue, here (time stamp 13:58), finding out what happens in a liquidity crisis, i.e., ‘Sell everything.’

Stay Tuned

Charts by StockCharts

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The Danger Point®, trade mark: No. 6,505,279