4 May chart update

GLD continues the slow grind and potential divergence can still be seen on the chart, shown with blue trendlines.  If the grind continues, divergence will dissolve and the issue fails to be an issue.  We opened and closed above the Bollinger band and we can expect that to happen 2.5% of the time, providing resistance for further progress.  Support comes in at previous resistance at 114.20.  Further support lies at the 18 day MA at 113.16.  This is also the Fibonacci 61.8% retracement line. 

6 Mo: "

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A new concept I am working on is the Elder impulse System.  It is designed to catch the big momentum move and then bail when the pressure starts to subside.  My thinking is to use this type of thing for short term trades and as a entry exit aiding tool for more long term type trades.  Read about it in the Chart School at Stockcharts.com.

The Impulse chart is showing green which indicates the momentum trade is still strong, with the slopes of the MACD histogram and the 13 EMA being positive.  Since we are above the 65 day EMA, this renders a long buy signal.  If the MACD histogram slopes turns negative, the chart will paint a blue bar indicating an exit from the long.  A red bar indicates both the MACD histogram and 13 day EMA slope is negative and would in itself indicate a short sale trigger.  But, in this case with the 65 day EMA slope positive or below the current price, it indicates the longer term trend is still up.  Therefore all short sale triggers must be ignored.

Elder Impulse System, daily: "

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SLV is also showing potential divergence, shown in a rather stark manner by the MACD histogram.  On the positive, divergence isn't really showing in RSI or stochastics.  I suspect silver may have a bit more upside potential than gold in the short term.  Price is right at resistance of 18.45.  Support is coming in at the previous high of 18.17 and further at the 18 day MA 17.86.  We are still under an over-bought reading on the RSI with an indication of 66.33.

6 Mo: "

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The Elder Impulse chart is painting green bars with positive slopes on the histogram and 13 day EMA. The divergence is shown on the histogram.  The Force Index is a new concept for me and I am including it to see if it is useful as trend verification or divergence tool.  Learn more about it in the Charts School. It is showing divergence in that lower readings are associated with higher prices over time.  The question that needs to be answered is how long can this indicator show divergence before it manifests a reversal?  Until I have a feel for that I will be basing my analysis on my usual indicators.

Elder Impulse System, Daily: "

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The miners have lagged for some time and now appear to be losing momentum before the actual metal.  On the other hand, GDX did make it to over-sold territory on the RSI, while the metals are still working on it.  The divergence is also present on this chart.  We hit overhead resistance and retraced yesterday.  support is coming in at the low from yesterday around 49.20, which is also the Fibonacci 61.8% retracement.  Stochastic remains above 80, but a cross there suggests a pullback to the 18 day MA or 48.12.  That is what I was betting on when I covered the shares at 51.

6 mo: "
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The Impulse chart is painting a blue bar, or signaling an exit from long trades.  Interesting, because I covered using my usual setup and it agreed with the Elder Impulse System.

Daily Elder Impulse System, Daily: "

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