A Different Perspective on GLD

The danger in analysis of stocks, markets, or even just general opinions (you ever notice when you have an opinion of someone you just meet, it sticks and can be hard to shake-even when you finally do shake it and they do something, you jump back to that opinion? Those are generally arbitrary opinions that most of us are all too happy to form), these opinions in the market can be very dangerous.

In life if we don't form an opinion of something (think politics), people say we sit on the fence, we don't pay attention to the issues or we are apathetic. There's nothing wrong with not having arbitrary opinions, changing your mind when facts present themselves and trying to see both sides of an issue.

In any case, I'm applying this logic to GLD which we have recently been trading from the short side based on the longer term charts, even though the daily chart appears as if it may be shaping up and a new trend in GLD (was an uptrend, changed to an intermediate downtrend), most likely a long term bullish one may be under construction.

Still, short, hit and run trades are working best right now.

 These are the areas we have made some of the bigger trades in GLD both short and long and recently the trades have been based on that small bearish descending triangle. So lets erase the trendlines and look at this again.

 Now we see a bigger pattern, a bearish bear flag and quite large. If in fact this is correct, then the short term move in GLD should be up to the top trendline. I have thought for the longer term trend to turn bullish, it will have to break below the lateral trendline which is also similar to a break below the large bear flag.

 Near term 2 min shows price being knocked down and recent positive divergences (first a relative positive, then a leading positive).

 Again on the 5 min, price is knocked down from a head fake breakout in the yellow box with a strong negative leading divergence and several positive divergences formed.

 I stopped trading GLD from the short side because the 15 min chart started shaping up, here it is in a local leading positive divergence

 Even the 30 min is shaping up, going from a relative positive to a leading positive divergence

And the 60 min chart is shaping up too.

I still think trades in GLD should be leveraged to make them worthwhile and nimble/short lived. I think we have a ways to go before a new primary trend is established, but this bearish pattern actually would be helpful in establishing a new bullish primary trend.

In the mean time, GLD may be worth a look for a speculative long on a move to the $162.50 area.