GLD weekly 12-18-12It’s been a while since I’ve made any updates to the GLD active short trade. In fact, this has been, by far, the longest active trade on the site.  The most recent short entry on GLD was back on Jan 30th on the re-test of the yellow sub-uptrend line within the larger (blue) ascending channel.  The first target, the bottom of the channel, was hit back on May 24th for an 11.9% gain.  GLD, much to the chagrin of gold bugs, has gone basically nowhere over the last year.  In fact, this short trade is still at a small profit from entry.

Although I don’t personally have a position in GLD and haven’t for some time, I’ve left this trade on since it has yet to exceed the stop criteria.  In fact, GLD has been hugging the bottom of that channel for months now, sort of how a drunk driver hugs the white line on the side of the road…. not exactly bullish behavior.  As you can see from this updated weekly chart, GLD is pinching towards the apex of that key horizontal resistance level above (174 area) and the bottom of the channel below.  One way or the other, that pattern will have to be resolved by early April (the point of apex).  A solid break above the 174 level would obviously be a bullish event, triggering a stop and possible a new long entry while a solid weekly close below the bottom of the channel would most likely usher in the next wave of selling in GLD, opening the door to the 2nd target (140) being hit.  Again, the fact that GLD has been limping along the bottom of the channel for months now, especially in light of QEternity, makes me lean towards a downside resolution of this pattern and as such, I will continue to leave GLD as an active short trade for now.