Gold -- interesting patterns

The chart of gold offers interesting price-volume patterns (click on the graph to enlarge it).

The first pattern. Bottoms took place on low volume -- a sign investors lost their appetite for the metal (see green arrows).

This second pattern is typically followed by a strong rise in prices, ending with a spike accompanied by above average volume close to the market top (see red arrows).

This price-volume action does not necessarily mean gold is about to collapse. It could suggest gold is entering a period of consolidation of several months -- as it happened from March 2008 to August 2009.

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
Ranked Top Market Timer in 2009 by Timer Digest

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