On Friday, we mentioned that a weak stock market might help strengthen the short-term bull case for gold. Stocks have been subject to outsized volatility the last few days, a signal worth paying attention to as these erratic periods can denote a change in character in the market .
With U.S. midterm elections coming up and stocks having failed to print lower lows following last week`s terrible inflation number, it may, in fact, be time for stocks to benefit from another bear rally. The chart below shows the technical picture for the SPY, which now favors at least a short-term rally as well. The index is pointing to a gap up at the open. A hold of that gap up into close would re-enforce the case for a swing trade to the 50-week moving average.
Does this mean gold is about to crash? Neither. However, the tandem moves we have seen in gold and stocks for quite some time may be ready to disconnect as the technicals for gold point to more sideways action. The picture on Friday looked as if a rally to the upside would gain momentum. Still, sellers stepped into squash those hopes, as can be seen with stochastic RSI pointing back down on the weekly timeframe .
Why is everybody silent on this?
Why you not talking about this!
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Source: KitcoNewsNOW - 🏆 13. / 78 Read more »