Gold broke out of its recent trading range in morning trading today following Janet Yellen’s remarks at 2PM East Coast time. Here’s the 5-day chart of GLD, our trading proxy for gold. Generally The Gold Enthusiast doesn’t like overly-confusing presentations, so this one is pretty simple. The white areas show price action during US regular market trading times. The grey areas show extended trading hours, 4-8PM Eastern for after-hour trading and 4-9:30AM for pre-market trading.
As you can see, GLD has been on a bit of a tear these past 5 days, rising from 112.60 to over 116.50 this morning. The arrow points at the time yesterday when Queen Janet Of The Fed gave her remarks. You see the usual short-term thrash up and down, as traders hurriedly change their minds and positions. Then in this case the clear direction became UP.
And UP it continued, except for a brief pause where day traders who are content with dimes and quarters sold their positions toward the end of the day.
One sign of strength in a chart is when, following the day trader exit, price resumes a previous upward march. And so it did. Around 6:20 (PM, Eastern) last night gold continued its march higher. Early morning traders noticed this, realized they weren’t making any money on the sidelines, and in they came. Which of course drove prices even higher.