Gold Glitters No Matter Where You Live

Gold broke above $1,550 per ounce Wednesday before finishing slightly below it. Near record highs, in nominal terms. Why is that phrase always added, ‘in nominal terms’. Sounds like a cop out, like ‘in dog years’ or ‘in the open era’. When I buy stuff today I always do it ‘in nominal terms’. What does it even mean? Do not write me a comment about inflation adjusted prices, I know that. The point is that phrase is never applied to anything else. And when I look at gold, using the SPDR Gold Trust Shares ETF, ticker $GLD, it looks good in nominal terms and any other terms you can come up with. Take a look.

GLD priced against the US Dollar Index, using the Powershares DB US Dollar Index Bullish Fund, ticker $UUP, has been rising in a stair step fashion for a long time. It is currently testing the top of a symmetrical triangle with a Relative Strength Index (RSI) that has moved higher off of the mid line and a Moving Average Convergence Divergence (MACD) indicator that is a bout to cross positive. The Bollinger bands are tightening as it tests the top rail. A breakout higher should lead to new all time highs in this ratio. It may happen today or it may test the bottom rail again first. But what about the rest of the world?

GLD priced in Euro, using the Currency Shares Euro Trust ETF, ticker $FXE, is looking to breakout above resistance and make new all time highs. The rising 50 day Simple Moving Average (SMA) is creating an ascending triangle with the top just over a ratio of 1.06.

Priced in Chinese Yuan, using the Wisdom Tree Dreyfus Chinese Yuan Fund, ticker $CBY, GLD is making a third run at the top rail of an ascending triangle using the 50 day SMA as a base, with the Bollinger bands beginning to expand. The RSI is rising and the MACD is about to cross positive.

GLD priced in Japanese Yen, using the Currency Shares Japanese Yen Trust ETF, ticker $FXY, looks very similar to GLD priced in US Dollar Index. There is the same symmetrical triangle after several iterations higher. The MACD is crossing higher and the RSI rising as it tests the top rail with tightening Bollinger bands (As an aside is the US like Japan? – maybe another story). A continuation and break out higher should lead to new highs in this ratio.

Sorry for 5 charts but the world is a big place. When you measure GLD priced in Emerging Markets Currencies, using the Wisdom Tree Dreyfus Emerging Currency Fund, ticker $CEW, you also get a bullish picture with the ratio about to break out higher and supported by a rising RSI and a MACD that has crossed positive. I could go on. Measured against the Australian Dollar, Canadian Dollar and British Pound gives the same picture. Everyone in the world will see GLD as a buy, so have you bought Gold yet?

As always you can see details of individual charts and more on my StockTwits feed and on chartly.)

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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