Weekend Gold Precious Metal Trading Report

By: Chris Vermeulen | Sun, Apr 26, 2009
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Last week was interesting with precious metals stocks finding support and moving higher to close above resistance on Friday.

Not much has changed in the past few days other than the BP chart (bullish percent index chart) for gold miner stocks which has put in a short term bottom. If gold continues to push higher above its resistance trend line I think we could see gold stocks follow suite and eventually out perform gold.

The BP chart can stay in the upper zone for several months as gold & gold stocks run higher at an accelerated rate.

Gold Precious Metal Bullish Percent Chart

Gold GLD Precious Metal Fund

Gold continued to move higher on Friday closing above two key resistance levels. Gold closed above my resistance trend line and 50moving average which sets a bullish tone.

What makes me excited is that gold rallied with the broad market. I mentioned in a previous report that when the broad market is so over bought and ready for a correction people were starting to put their money into gold because it's known as a safe haven. In the past the broad market would rally and gold would go down; if the broad market pulled back, gold would rally.

So with Fridays rally in both gold and the broad market it says a couple things to me.

  1. Friday was light volume and only buyers were sticking around buying the market higher.
  2. Broad market is over bought & at resistance, smart money is moving into gold.

Gold Precious Metal Trading Conclusion:

Gold and the broad market have set the stage for another rally in gold with the broad market moving lower over the next 3-6 weeks. I do not think the broad market will make a new multi year low but I think will correct 50% of this current rally.

I can see gold testing the $1000 mark again but do not think it will breakout and rally much higher. This is because if we get a controlled pullback in the broad market over the next 3-6 weeks and stocks start to rally again confirming a bottom in the stock market then I think we will see a lot of money get pulled out of gold and put into equities.

We should have some exciting movements this week with gold testing resistance and oil staring to move higher in its final stages of a cup & handle formation.

If you would like to receive my free trading reports please visit my website at: www.GoldAndOilGuy.com.

 


 

Chris Vermeulen

Author: Chris Vermeulen

Chris Vermeulen
President of AlgoTrades Systems
www.TheGoldAndOilGuy.com

10126 Hwy 126 East, RR#2
Collingwood, ON, L9Y 3Z1

Chris Vermeulen

Chris Vermeulen, founder of AlgoTrades Systems., is an internationally recognized market technical analyst and trader. Involved in the markets since 1997.

Chris' mission is to help his clients boost their investment performance while reducing market exposure and portfolio volatility.

Chris is also the founder of TheGoldAndOilGuy.com, a financial education and investment newsletter service. Chris is responsible for market research and trade alerts for of its newsletter publication.

Through years of research, trading and helping thousands of individual investors around the world. He designed an automated algorithmic trading system for the S&P 500 index which solves his client's biggest problem related to investing in the stock market: the ability to profit in both a rising and falling market.

AlgoTrades' automated trading systems allows individuals to investing using either exchange traded funds or the ES mini futures contracts. It is supported by many leading brokerage firms including:

- Interactive Brokers
- Trade MONSTER
- MB Trading
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He is the author of the popular book "Technical Trading Mastery - 7 Steps To Win With Logic." He has also been featured on the cover of AmalgaTrader Magazine, Futures Magazine, Gold-Eagle, Safe Haven,The Street, Kitco, Financial Sense, Dick Davis Investment Digest and dozens of other financial websites. His list of personal and professional relationships approaches 25,000, people with whom he connects and shares is market insight with out of his passion for trading.

Chris is a graduate of Seneca College where he specialized in business operations management.

Chris enjoys boating, kiteboarding, mountain biking, fishing and has his ultralight pilots license. He resides in the Toronto area with his wife Kristen and two children.

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Source: The Contrarian Take http://blogs.forbes.com/michaelpollaro/
austrian-money-supply/