January 27, 2017

#GOLD - $GLD $DUST Correction may be on the way as #MACD turning

Attached is the gold chart on continuous futures contracts (attachment 1). As can be seen the MACD, which hasn't been as high since September 2016 is turning down. The Point&Figure chart (attachment 2) shows that the gold rally stopped exactly at the resistance level around US$ 1,210 per ounce.

Attachment 3 is the HUI (Gold Bugs Index), which reflects a portfolio of gold stocks. As per Gold Barometers, which we published on Monday, gold stocks were 100% overbought. Here also the MACD is turning down. 

To protect your gold shares holding you might buy DUST (US$) 34.82 Direxion Daily Gold Miners Index (3X bear). This is a highly leveraged vehicle and extremely volatile. If the share price of gold stocks are going down, the price of DUST is rising. As attachment 4 reveals DUST reached a top in December 2016 at around US$ 70 per share and declined to around US$ 30 a few days ago as gold stock were rallying. The MACD is just about crossing the red line, a bullish sign for DUST.  

 

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