Gold GLD Comes into Support Plus Intraday Views

Jun 5, 2009: 11:17 AM CST

Here at the Trader’s Expo, there has been a lot of talk about gold, particularly with the volatility of the last two days.

GLD (Gold ETF) has pulled back into a possible confluence support level – let’s see it and also see the volatile Trend Day Down, Trend Day up, and Friday’s morning gap action on the intraday charts.

GLD Daily:

Gold (GLD) was making an impressive run up to challenge the $1,000 ($100) level but met resistance just shy of this critical target level.

From an Elliott fractal standpoint, it appears that we had Wave 1 up off the April lows, Wave 2 down into the May lows, and then the move through May has been a 3rd wave with the current pullback a possible Wave 4 into support.

We have simple confluence support (on GLD) at $94, which represents the rising 20 day EMA and the 38.2% Fibonacci retracement at $93.63 (I drew it inverse).

The next lower level of confluence EMA and Fibonacci support comes in around $92.  I would feel less confident if we pulled back beneath that level.

For now, odds seem to favor support at this level, or at least a favorable risk-reward opportunity for those so inclined.

However, do be careful, because GLD (and Gold) have been quite volatile the last few trading days.

GLD 5-min 3-day chart:

Gold “fell off a cliff” on June 3rd, producing a steady and sustained “Trend Day Down.”

A pullback in an uptrend is completely expected, so it wasn’t shocking, but what was shocking was the about-face Trend Day Up that formed on the next trading day (Thursday).

Both of these were almost perfect examples of Trend Days in terms of the gap and EMA resistance/support.

As if that wasn’t ‘bad’ enough, we gat a sharper and more violent gap down on Friday’s open which took price beneath Wednesday’s lows and we’ve pulled back in what appears at this moment to be forming another possible Trend Day Down.

It’s enough to make your head spin!  Unless you’re scalping (playing for small, intraday targets), this is very difficult to trade at the moment for swing traders due to the gaps.

Be safe if you’re a newer trader taking part in this action.

Corey Rosenbloom, CMT
Afraid to Trade.com

Subscribe for the RSS Feed here.

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

4 Comments

4 Responses to “Gold GLD Comes into Support Plus Intraday Views”

  1. Vladz Says:

    Daily Downtrend, but at uptrend line of past few months, what gives?
    http://esecfutures.com/wp-content/uploads/2009/

  2. tgarfield Says:

    COuld I put you on the spot to attempt a new elliot wave count of oil. The pictture is getting bigger, I think a little clearer than gold as well.

  3. Indrajit Says:

    Corey,

    I now miss ur analysis on Nifty. Can u analyse Nifty now? I feel its on bull run, but need ur expert comments on elliot wave as I am not a follower and master of waves.

    http://www.stockmaniacs.blogspot.com

  4. Indrajit Says:

    Corey,

    I now miss ur analysis on Nifty. Can u analyse Nifty now? I feel its on bull run, but need ur expert comments on elliot wave as I am not a follower and master of waves.

    http://www.stockmaniacs.blogspot.com