Click
to Enlarge
Since I warned of the weakening technical outlook for gold, it has dropped over $70 from the recent highs. It has tried to stabilize over the past few sessions, but has not rallied alongside stocks, which is a concern. Though the monthly OBV did confirm the recent highs, the weekly OBV did not, and it has not dropped below its WMA. This suggests the rising wedge formation may be completed and we could easily see a break to the $1120-$1140 area if not the main support at $1050.
Tom Aspray, professional trader and analyst, serves as video content editor for MoneyShow.com. The views expressed here are his own.
