Playing Contrarian With Gold

These days it feels like we won't have another down day on equities or an up week in gold. Taking a look at the SPDR Gold Shares (GLD) daily chart, I want to play contrarian here. This is a pure technical play based on the oversold nature of GLD. It's not a belief we'll see folks move back into gold as a hedge or my view the economy is set to crumble. 

I'm focused on two indicators here. First, we have a bullish divergence as indicated by the higher lows in the Chaikan Money Flow. It's a subtle higher low, but it is also building. The recent higher low was the second in the past month. Additionally, we have a bullish crossover in the Slow Stochastics while in oversold territory. The recent bounces have been much here, but the lower highs provide the opportunity for a bullish divergence here as well with any small push higher in the ETF. ...145 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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