Gold (GLD) Chart Cracks – 4/6/09

I charted GLD, a major Gold ETF, at 2:00 pm on April 6, 2009 to show the daily price changes for the past three months.

• GLD broke below its trend line of higher lows three days ago and did not recover the following day
• Today GLD broke below its shorter trend line of lower lows
• GLD also broke below the longer-term horizontal support line of lows that used to be the point of resistance in early January
• GLD moved below its 10, 20 and 50 day moving averages a week ago and hasn’t regained its footing yet
• Williams %R broke away from overbought a couple of weeks ago signaling a sell point
• Williams %R is now in oversold territory, but that does not mean it is ready to bounce yet

Opinion = The time to get out of GLD was two weeks ago when Williams %R broke.  The time to get back in will be when %R moves back out of oversold, preferably on both the 14 and 28 day indicators.