GLD Gold ETF Weekly Chart; Overbot; Rising Wedge; Negative Divergence; Upper Band Violation; Price Extended

Gold bulls and bugs are happy at the chart above that moves from the bottom left to the top right. What a run. Alas, however, like all good things, there is an ending. Gold is about to receive a multi-week spankdown due to the neggie d. The GLD gold ETF is shown above; it can be shorted going forward, or simply play GLL long which is the inverse image of the GLD chart, as would be expected. The money flow is trying to sneak out more bull juice but the fuel tank is pretty much empty. The only thing that would change the negative outcome for gold on the weekly basis ahead is a news event. If something bad happens of course folks will run to gold but barring that, gold will begin rolling over at any time and likely remain soggy for the next month or two.

Are you ready for some mumbo-jumbo? Let's do it. The red lines show all the chart indicators negatively diverged so the top is in on this weekly basis, however, as mentioned, keep an eye on money flow since the gold bulls are trying to squeeze out another week or so of gold joy. If you enjoyed the rally, now would be a good time to scale out although read below about the monthly chart that is still bullish. The red rising wedges are bearish patterns and the drops from rising wedges can be quite dramatic. Price is extended above the moving averages requiring a mean reversion lower.

The doji candlestick sticks out like a sore thumb indicating a lot of indecision which many times results in a trend change. 10 weeks ago, a shooting start candlestick printed which is bearish and signals a trend change but that likely did not happen due to the non-stop news flow that encourages gold buyers.

The RSI, stochastics and money flow are coming off overbot levels during the last year and all three are agreeable to more downside. Price has violated the upper standard deviation band so the middle band at 157, and rising, which is also the 20-week MA, is on the table as well as the lower band at 143 and rising. The ADX shows gold in a strong uptrend since last summer so the gold bulls have nothing to complain about; it has been wine and roses over the last year except for the March hiccup. The ADX, however, is slinking lower. Note that for each high in gold, the strong upside trend peters away each time. The strong upside weekly trend will be gonzo once the ADX slips sub 30.

The Aroon positive cross remains in play since the end of 2018 except for the March 2020 stutter-step. So if you bot gold solely based on the Aroon positive cross, you would have ridden GLD from 115 to 165. The green line is pegged at one hundo so it has nowhere to go but down which is bearish. Look for a negative Aroon cross in July. The three tight standard deviation band squeezes were all up moves which is interesting. The tight bands (pink arrows) tell you a big move is coming but does not predict direction.

The gold naysayers will have their way during July. The GLD and gold monthly charts, however, display long and strong MACD lines so price does have the juice to come back up for another matching or higher high on the monthly basis. Thus, gold can be shorted now. Remain short for the next 3 to 8 weeks; it will likely depend on how fast or slow and how far she fails on the weekly basis. Then a multi-week recovery back up to the highs again; a double-top is definitely on the table. At that time, gold will likely top out on a long-term basis and not see new highs for several months and probably a few years.

Thus, to keep it simple, gold tops out over the coming days and begins falling on a weekly basis. Gold will sink lower, perhaps to the gap-fill at 153-ish, there is also strong price support at 148-ish, say a bottom at mid-July or so, then back up to satisfy the strength on the monthly chart for a matching or higher price high say mid-August. This high will be key because the monthly chart will likely go neggie d and the long-term top and fate of gold would be sealed. Plan accordingly.

GLL is traded at far lower volume. Keystone will either short GLD or long GLL going forward to play this weekly slump that will begin now. The gold miners, GDX, GDXJ, will likely roll over too but they will probably lag (top-out) gold by 1 to 3 weeks. The gold short can be flipped back to the long side in a few weeks after the selloff occurs and the weekly chart turns possie d. Then the big-time top in gold will occur in a couple-three months when the monthly chart negatively diverges across all its indicators (watch the MACD).

So gold will top out on a long-term basis (monthly chart) probably in August-September. No one expects that in these tumultuous days, that gold will hit a ceiling in 2 or 3 months and then underperform and trail lower for many months forward probably a year or few ahead, it seems ludicrous; that is why it will happen. As mentioned above, if a negative news event occurs, gold will be buoyed. Gold is now trading at 1757 on Tuesday, 6/23/20, at 6 AM EST. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 2:46 PM EST: GLD is at 166.06. The gold bulls scoff at any consideration that gold will trend lower from here. The GLD weekly chart is neggie d across all indicators as explained above. The daily and hourly charts are a bunch of slop. GLD pops higher so the bulls will proclaim a breakout from the 164-ish resistance on the daily chart, however, you can clearly see the neggie d over the last few months. In the very short term, the indicators are stiffening higher as gold price prints the orgy high, so this does hint at a day or few of buoyancy remaining (bumping sideways). Ditto the 2-hour. Oh, that is interesting. Bring up a GLD 2-hour chart, you see the orgy high today, price making higher highs for the last 10 candlesticks more or less, the RSI is flat which is neggie d, ditto stoch's that are also overbot, RSI also overbot, money flow is neggie d. MACD line is neggie d over the last month but is trying to eek out juice. This is the top here for GLD so you do not have anymore time to make a decision. GLD price will likely top out today or tomorrow morning. If you want to keep your gold, hedge it. Otherwise, the short side is best going forward the next few weeks as explained above. GLD may flush lower into the close today or tomorrow morning. Watch the MACD on the GLD 2-hour; the top is in for the hourly time frame when the MACD rolls over.