GLD Update

Since this weekend's news I've been very interested as to how gold would react, would it follow the $USD legacy arbitrage correlation and move up on a $USD gap down or would it follow the QE sentiment it has been tracking for some months? With the F_E_D blackout period starting tomorrow ahead of this months's F_O_M_C meeting, this should be an interesting asset to watch and see if some more trades set up.

 We identified this classic bearish short set up in GLD and suspected, as usual the shorts would be taken for a head fake ride as the descending triangle (consolidation/continuation pattern with the preceding trend being down implied a move down to start the next leg) formed and 3C went positive in a big way.

 Here's the bearish price pattern and a 30 min 3C leading positive divergence at support, I didn't take the trade unfortunately but several members made up to and over 200% with options on the huge gap up move in GLD, the hourly chart also shows where the move turned in to a negative divergence.

 This a.m. GLD did not hold the higher open on a weaker dollar, but like many other assets shows a 1 min intraday positive developing since.

 The 2 min chart shows clear non confirmation of the opening and 3C is in line with the price trend here-again it's up to the 1 min chart to strengthen and start influencing longer timeframes.

The 15 min 3C chart which won't be moved positively until the 1 min chart spreads through the timeframes on strength, shows not only the positive divergence at the triangle's lows, but also where selling started coming in on a negative divergence.

I'll be very interested to see what gold does over the coming days. Hopefully we'll get another nice set up, I don't really care which direction.