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Are You Riding The Gold Bandwagon?

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Everyone loves Gold now. It is always the case. SPDR Gold Trust (ETF) (NYSEARCA:GLD) has had a massive run higher, rising about 10% since the December lows. It has cleared some significant hurdles along the way as well. It is back over its 200 day SMA for example. But despite all this, technically Gold is still in a long term downtrend. I know, sorry to be the party pooper.

The chart below tells the story. If you are a very short term trader then the recent move up is a windfall if you caught the bottom. But the downtrend that has been in place since late 2012 is still in control. In fact the downward channel from mid 2013 has not even been broken yet. Momentum is improving but still has not turned bullish.

Gold could certainly be reversing for a big move higher. Every reversal has to start somewhere. But technically until Gold can break above this channel it is nothing more that the same old range of movement that it has exhibited for nearly 3 years. Look for a move over 1200 per ounce in the shiny metal or over 113 in the Gold ETF ($GLD) as a spot to start to get excited.

This was originally shared on Dragonfly Capital Views
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The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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