Gold Funds

GLD, IAU, and UGL are non-leveraged funds that match the indexes. DGP is the double Bull fund for gold and DZZ and GLL are the double Bear funds. GDX is a Bull funds that tracks the gold mining stocks.

Below under “Comments, Analysis, and Recommendations”, I will write my comments for the Gold Funds giving you my chart analysis. I want to give you good evidence as to why I believe the Gold Funds are heading higher or lower. I base my analysis on several technical tools. I use Exponential Moving Averages, Elliott Wave Analysis, Fibonacci, Japanese Candlestick patterns, trend lines, and support/resistance lines.

My goal is to provide you with the information needed so you can make the best trading decisions. My goal is also to help you to become profitable and most of all to help keep you from loosing a ton of money. I will provide you the potential price targets to take profits and stop loss levels to help preserve your trading capital.

Click on the desired Gold Funds link below to view the chart.

DGP DZZ GDX GLD GLL IAU UGL

Comments, Analysis, and Recommendations

The Gold Funds could not hold onto the higher prices made after the open. GLD gapped up on the open and headed higher and broke above the previous day’s high. However, it closed down for the day, which was below the previous day’s close and near the sessions low as well. This does not bode well for higher prices.

The price action on 3/3/10 formed an island reversal, which is a bearish pattern. Could the Gold Funds be ready to start its next move to lower lows? Fist, the 3/3/10 high must hold off any attempt at higher prices. Second, a drop below the 3/1/10 low will be the first hint that the next leg down has started. A break below the 2/25/10 low will be a stronger hint and a clear five-wave decline from the 3/3/10 high will be the strongest.

Be a smart trader!

Craig Wells

The Gold Funds have been no different from the rest of the funds I follow. The bounce has been a little stronger than I had expected. GLD made the 76.4% Fibonacci retracement level just as everything else have. The Gold Funds should turn down soon if my Elliott Wave count is correct. The price cannot break the 1/11/10 high, or I will have to re-evaluate the charts and reconsider the direction for the gold price.

The first sign that the next leg down is underway will be the 2/25/10 low. A clear five-wave move down will be better. With the distance between the current price and the 2/25/10 low, we very well could see a five-wave pattern before a price break below the 2/25/10 low.

If I expect lower prices for gold and with the retracement seen in GLD, then the price must start its next leg down soon. The corrective pattern potentially could be complete with today’s price action. We will know something in the next day or two.

Be a smart trader!

Craig Wells

The Gold Funds look poised to head lower, below the 2/5/10 low. The price closed below the trend line mentioned last night. I can also count an Elliott Wave five waves down, which indicates the potential for the next leg down is underway. If this is the case, the price cannot cross above the 2/19/10 high.

The price gapped down on the open and tried to muster up a rally. It failed and closed near the lows of the day. I would not be surprised if there is a little bounce tomorrow before the downtrend resumes in earnest. There is an unfilled gap from the 2/23/10 open, which could draw the price.

Be a smart trader!

Craig Wells

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