Wednesday, November 30, 2016

11/25/16 #GoldShares Chart $GDX #Free Reposted

Gold Shares Chart
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

Gold Shares' overall trend, revealed by trends of price, leverage, and time, are define and discussed below for subscribers.

Subscriber Comments

Chart 1

A weekly close below support from 21.07 to 23.02 supports the bear phase, while a close above resistance from 26.17 to 27.61 could reverse it. A reversal favors testing of higher resistance.

On Balance Volume (OBV), a crude measure of trend energy, has been lagging price since April. This negative divergence, an indication of distribution, is bearish until reversed. Gold shares advancing to declining issue and up to down volume, similar measure of accumulation/distribution, generated a bearish crossover in August (chart 2). The crossover introduces a bear phase for the gold shares, gold, and silver.

Bears' desire to chase, however, runs against the message of the market.  Bullish divergences between price and advance-decline percent (breadth) often setup powerful short-covering rallies or trend transitions (chart 2).  The bullish divergence which began in October continues to wide as price declines.  This is a warning to the bears.  

Chart 2


Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.