Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

GLD: Gold ETF Ready To Break Out To New Highs Now

By Deron WagnerETFsMay 14, 2020 01:22AM ET
www.investing.com/analysis/gld--why-gold-etf-is-ready-to-breakout-to-new-highs-now-200524578
GLD: Gold ETF Ready To Break Out To New Highs Now
By Deron Wagner   |  May 14, 2020 01:22AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The Morpheus swing trading strategy is primarily focused on buying breakouts of growth stocks with a history of strong earnings growth.

But if you’ve been following us any time since 2004, you may also know that we occasionally also trade ETFs with convincing chart patterns.

The SPDR Gold ETF (NYSE:GLD) is one such ETF to put on your radar for a potential breakout to a fresh 52-week high.

Check out the bullish pennant formation forming on the weekly chart of $GLD now:

Gold ETF Weekly Chart
Gold ETF Weekly Chart

The SPDR Gold ETF broke out to a new high in late February 2020, then became extremely volatile throughout the coronavirus sell-off and subsequent recovery into mid-April. However, notice on the chart above that GLD has been forming a bullish pennant formation at its high or the past five weeks.

If GLD rallies above resistance of the upper channel (pink line), the ETF will be poised to break out for another move higher.

The Gold ETF Buy Setup

The weekly chart time frame (above) removes “noise” from the price action in order to more easily see the longer-term trend and pennant pattern.

But let’s next drill down to the shorter-term daily chart for a closer look at the potential buy entry point:

Gold ETF Daily Chart
Gold ETF Daily Chart

The arrow on the chart above shows the GLD breakout entry, which is above the upper channel of the bullish pennant formation ($162 area).

A rally above the $162 level would also represent a move above resistance of the prior high from May 8.

As always, look for a volume spike when GLD moves above resistance. Sharply higher turnover on the breakout day would confirm institutional accumulation.

Leveraged Gold ETF Alternatives

GLD is designed to track the price of spot gold—it moves approximately in sync at 1/10 the price of an ounce of spot gold. If you’re looking for more “bang for the buck” when trading gold, you may instead consider buying ProShares Ultra Gold ETF (NYSE:UGL) or VelocityShares 3x Long Gold ETN (NASDAQ:UGLD).

UGL is a leveraged gold ETF that tracks the price of spot gold at a ratio of 2:1. This means UGL will increase roughly 2% for every 1% that spot gold goes up.

If you want even more leverage, UGLD is an ETF designed to track gold at a 3:1 ratio.

However, because of the way they are designed, please be aware that ALL leveraged ETFs are much better as short-term trading instruments, rather than long-term investments.

Original Post

GLD: Gold ETF Ready To Break Out To New Highs Now
 

Related Articles

BlackBull Markets
Yellow Card For Sports ETF By BlackBull Markets - Sep 01, 2021

Cristiano Ronaldo announced that he would be leaving Juventus Football Club (MI:JUVE) and returning to play for the club where he started his professional career, Manchester United...

GLD: Gold ETF Ready To Break Out To New Highs Now

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email