The short market day on Monday saw GLD drop from the Friday close of 118.02 to 116.09. In trader-speak, this was a drop of one full level in just one trading day, which is a significant drop. And, volume was higher than it’s been for over 2 weeks, indicating the drop is indeed significant. So is the drop something we can understand?
This drop brings gold below the rising support line at 117, and opens the possibility for more of a drop. This is doubtless the reason for Monday’s large volume. With stock markets continuing to make new all-time highs, who wants their money stuck going sideways or possibly even down? Pull the money out and let’s get some use out of it, is how conventional wisdom goes.
And as far as conventional wisdom, that’s pretty good. Usually conventional wisdom gets you stuck fighting the market, where you don’t want to be.