Here’s the issue with gold: it’s difficult to find as much info on it as stocks. For many investors, the buzz around Costco’s (COST) gold sales put gold back on the mainstream radar. But that won’t tell you if it’s still a smart buy or what price you should pay for it.
This is where technical analysis comes in—it examines things from a clearer, more objective perspective.
In a previous article, I covered gold projections using SPDR Gold Shares ETF (GLD) as a proxy. If you were even semi-bullish on gold, I hope you followed along, as intermediate-term targets were hit, along with an added bonus of a short-term trade.
Let’s take a look.
First, log in to your StockCharts platform and click here for the weekly before/after chart.
CHART 1. WEEKLY CHART OF GLD. The price bars after the orange arrow is what happened after the September 17 article on GLD.Chart source: StockCharts.com. For educational purposes.
In a nutshell, here’s what happened:
The orange arrow pointing at the 127.20% Fibonacci Extension is where the last article left off.
The 138.20% Fib target was also reached, and GLD appears to be moving toward the 161.80% target.
The daily chart also pointed out a solid entry point, and now you can see the before and after results laid out clearly.
CHART 2. DAILY CHART OF GLD. The green vertical line denotes the before/after in relation to the September 17 article.Chart source: StockCharts.com. For educational purposes.
Take a look at everything to the right of the green vertical line:
As mentioned in the last article, the 50% level at the bottom of the 2nd Quadrant Line marks a strong entry point. The magenta circle highlights the bounce, as anticipated.
As price reached the 138.20% Fib extension target of $242.50, there was yet another short-term trading opportunity that occurred—a measured move of 5.2% from the bounce to just under $247.
Can GLD Hit the 161.80% Fib Extension Target Above $250?
Although analyst targets are varied, Goldman Sachs just upped its gold target to $2,900 an ounce, but it’s a long game. If you’re looking at GLD, that would mean a potential price of $280, and Goldman is aiming for early 2025. So expect some bumps along the way, with pullbacks likely. Keeping an eye on the global and economic factors pushing gold is key if you’re in this for the long haul.
Central banks are also playing a big role in the gold market. In 2024, they scooped up 290 metric tons of gold in just the first quarter—the biggest quarterly haul in over 20 years. With no signs of slowing down, central banks are keeping gold demand strong and steady, setting the stage for its long-term growth.
Closing Bell
So let’s wrap it up. There are plenty of reasons to be bullish on gold. If you’re eyeing GLD, keep tracking those Fib targets, but don’t forget that the ride could be bumpy. You will have to redraw a new set of Quadrant Lines and measure both the pullbacks and extensions. You may also find a few more shorter-term trades in the process. While global factors may shake things up along the way, you’ve got the tools to take advantage of the situation, no matter which direction GLD takes.
Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation or without consulting a financial professional.
