With the price of crude oil trading near $61, the U.S. dollar falling and investors unsure where gold and silver are headed from here, today King World News shares a fascinating piece which features a key illustration about what is really happening with the price of gold.
By Louise Yamada, Founder of Louise Yamada Technical Research Advisors
May 6 (King World News) – Gold Spot price (GOLDS-1,178.59) carries an enigma in behavior over the past six months in that with the dollar rally, Gold went nowhere; with the stock market rally, Gold went nowhere. Both of these relationships are generally inverse in nature.
However, from a Relative Strength perspective, the expected underperformance of Gold versus the dollar and versus stocks, has held Gold has underperformed both.
Now with the dollar pulling back and the stock market mixed, Gold is still flat (see chart below). The potential for a Gold rally may still lie ahead, but at the moment there is no compelling technical indication, as both the monthly and weekly momentum models remain flat and indecisive.
Therefore, the stalemate between the support from 1,147-1,131 and resistance at 1,273-1,300 remains. Whichever parameter is breached should determine the next short-term direction for Gold. This was a small portion of Yamada's 50 page report. To subscribe to Louise Yamada Technical Research Advisors CLICK HERE.
***ALSO JUST RELEASED: Gerald Celente – We Are About To See Total Panic Engulf The World CLICK HERE.
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