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Gold Rushing Over $3,000 Forever?
Gold just won’t stop going up. Topping $3,000 for the first time the other day, it looked like we were going to experience a little pullback. That happened in the morning for a few hours but the bulls took over after the FOMC. Spot gold pushed well above the $3k mark while SPDR Gold Trust (GLD - Free Report) enjoyed a 41-bps upside day to $281.11.
The 14-period RSI on GLD is now overbought, a condition it’s seen many times along this rally. The last time it crossed that threshold was February, when prices topped out just above $270. Up here in uncharted territory, there’s no telling where the base metal might carry this thing.
Moving Averages: Bartosiak starts by examining the stock's moving averages, such as the 50-day and 200-day moving averages. He points out the significance of crossovers and divergences between these averages, which can indicate potential trend changes.
Support and Resistance Levels: Bartosiak identifies key support and resistance levels on the chart. These levels act as barriers that the stock price must breach or hold above, providing traders with critical decision points.
Chart Patterns: He discusses chart patterns like head and shoulders, cup and handle, or flags, and their relevance in predicting future price movements. These patterns can offer valuable insights into potential bullish or bearish trends.
Volume Analysis: He emphasizes the importance of volume analysis in confirming price trends. An increase in trading volume during a breakout or breakdown can validate the significance of a price move.
Dave Bartosiak's technical analysis approach adds depth to our understanding Gold’s chart. By paying attention to moving averages, support and resistance levels, chart patterns, technical indicators, and volume, he equips investors with a comprehensive toolkit for making well-informed decisions in the stock market. Remember, while technical analysis is a valuable tool, it's important to consider other factors like fundamental analysis and market sentiment before making investment choices.