GLD Gold ETF sitting on crucial support less resistance

The GLD Gold ETF is sitting on critical support similar to the way the GDX ETF is in my previous posting.

We need to see the gold price hold support here.  The GLD has broken out and above the long resistance line shown in the chart on confirmed valid volume.  One of the most common things you will see on any stock price chart is the return of price to previous resistance.

In this case the breakout was at about 90.93 on the GLD ETF and now we see clearly that price has retraced right back to this support. and volume has dropped off on the decline although it is a bit heavier than normal.  So again, price returning back to resistance line is quite normal price action and should have been expected given the old owners near the 100 level on the GLD.

A theory I have been postulating on the nature of this run in GLD is that price will move faster than it has before the higher above 90 we are. The reasoning for this is that we have less and less resistance on the left side of the chart. This correction we have been in the last several days has been sharp and swift. Could we expect a sharp and swift reaction back to the upside that quickly tests 100 level again? It is possible.  And the reason it is possible is because there is less resistance on the left side of the chart.

If you look at the shaded orange area in the chart above you can see how little price there is to hold us back. And of course above 100 there is zero price holding us back.

It is going to be interesting to see how GLD holds up on this new support now.  Breaking down below 90 would not be a good sign at all.

But for now there are enough positive signals to suggest that we will hold here.

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