Comex Gold & GLD Breakout To New Highs | MartinKronicle - Michael Martin
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Comex Gold, GLD Breakout To New Highs

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For all the chatter about Gold (GLD or Comex Gold Futures) being overbought or in a bubble, the price activity today proved otherwise. A great thing about trend following is that the price will help you get clarity when you can’t figure out what all the analysts are saying.

The breakout occurs when a previously held high price is overcome by a trade at a higher price (indicated by the red circle on the chart). Today we set a new 20-day high, so a lot of trend followers who trade breakouts likely got long.

But before the trend followers could get long, they had to wait for the gold downtrend to be broken.

The US Dollar Index can uptrend because it is the evil of two lessers as I wrote about yesterday in Jim Rogers: USD Rally Short-Lived. In a garden of rotting tomatoes, the US dollar (USD) may be the most edible.

GLD and Comex Gold can uptrend because everyone thinks the US Dollar Index move will be short-lived.

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