Streettracks Gold Shares (NYSE: GLD) Headed For A Correction Says Market Timer Frank Kollar
October 30, 2007 (FinancialWire) (By Frank Kollar)
Shares of Streettracks Gold Shares (NYSE: GLD) have been rallying since mid-August and have not even come close to a correction in the last two months.
We recently wrote; “When Streettracks Gold reaches $76.94, it will be pushing against a strong Fib resistance level that is likely to result in many Fib traders taking profits. That should cause a slowdown in this powerful gold rally.”
Now we are above that resistance level and every gold fund trader as well as every news commentary in invariably and unabashedly bullish. So far, we have not seen any selling materialize.
This spells trouble to us. The gold rally is very overbought and most traders are sitting on profits. All it will take is a match (negative news article, etc) to light a fire under them and we could see some heavy selling. That is not to say gold is not going higher, only that it is at precarious levels considering there has been no profit taking to mention for over two months.
The Fibtimer.com (http://www.fibtimer.com) ETF Timing Strategy may have a position in Streettracks Gold .
Kollar’s research has shown that the financial markets are in tradable trends approximately 80 percent of the time. FibTimer strategies define trends and trade them in both advancing and declining markets. Caring nothing about what newscasters say or what the latest economic indicator predicts, trends are where the profits are, and that is where FibTimer is.
Kollar is editor and chief analyst at FibTimer.com (http://www.fibtimer.com) which offers market timing strategies for S&P and Nasdaq index fund traders, as well as bond, gold, small cap, sector, ETF and stock trading strategies.
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