The major down trend has converged with the short-term and intermediate trend. We've also built a basing formation and in a pennant consolidation pattern. I think we auction up to the major 38% fib and 50% of the trend.
Hi I totally agree with your bullish view on Gold/Gold Mine, but do you think it's good strategy to buy when RSI hit 70 area? maybe, we should wait for Gold/Gold miners to pull back during next few days when get rid of political tensions, and buy on dip on GDX
mattcook
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@lantao517, Hello, I don't ever use RSI or indicators so I couldn't weigh in on that. It all depends on your timeframe. I read the auction and can say Gold is money and trades as such. It's correlated to real interest rates and inversely priced in USD. As such, watch the FRB and geopolitical tensions as it relates to risk appetite for the USD. In context, the Fed didn't do anything they promised as it relates to QE. They didn't raise rates substantially, unwind their balance sheet and other central banks have followed suit. The gold bid we're seeing since last February is resuming where it left off IMO.
simbha
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Nice analysis.
May be good to wait till USD and rate increase this JUNE.
mattcook
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@simbha, I agree.... I can see a scenario where the Fed is backed into a corner into raising rates in June and the aftermath afters creates a realization the normalization was just an illusion. Ha!