Tag Archives: gld

Resurgent Interest in Gold

By Tom McClellan

GLD Assets Show Resurgent Interest in Gold

GLD Assets
February 04, 2016

In spite of dollar strength, gold prices have rallied up from the low we saw back in mid-December.  It took a while, but this rally has finally started to bring more interest from retail gold investors.

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GLD’s Bullion Inventory and the Gold Price

By Steve Saville

What do changes in GLD’s bullion inventory tell us about the future gold price?

Physical gold ‘flowing’ into GLD and the other gold ETFs does not cause the gold price to rise and physical gold flowing out of gold ETFs does not cause the gold price to fall. The cause and effect actually works the other way around, with the price change being the cause and the flow of gold into or out of the ETFs being the effect. I’ve covered the reasons before (for example, HERE and HERE), but cause and effect are regularly still being mixed up in gold-related articles so I’m revisiting the topic.

The Net Asset Value (NAV) of a gold ETF such as GLD naturally moves up and down by the same percentage amount as the gold price, so a change in the gold price will not necessarily require any change in the size of GLD’s bullion inventory. It’s only when GLD’s market price deviates from its own NAV that a change in bullion inventory occurs. For example, assume that the gold price gains 10%. In this case, GLD’s NAV will gain 10% and there will be no increase or decrease in GLD’s inventory as long as GLD’s market price also rises by 10%. However, if GLD’s market price rises by 11% then gold will be added to the ETF’s inventory to bring its market price and NAV back into line, and if GLD’s market price rises by only 9% then gold will be removed from the ETF’s inventory to bring its market price and NAV back into line.

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6-Year Low in GLD’s Bullion Inventory

By Steve Saville

The Meaning of the 6-Year Low in GLD’s Bullion Inventory

At the end of the week before last the amount of physical gold held by the SPDR Gold Trust (GLD), the largest gold bullion ETF, fell to its lowest level since September-2008. What does this tell us?

In many TSI commentaries over the years and in a couple of posts at the TSI blog over the past year I’ve explained that changes in GLD’s bullion inventory are not directly related to the gold price. Neither a large rise nor a large fall in the gold price would necessarily require a change in GLD’s inventory, the reason being that as a fund that holds nothing other than gold bullion the net asset value (NAV) of a GLD share will naturally move by the same percentage amount as the gold price.

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NFTRH; Key ETF Update

A snapshot of the current technical status of several key markets (a lot of charts today because macro changes seem to be in effect)…

GLD broke down from the Sym-Tri (strike 1), lost the June low (strike 2) and now would try to find support at the December low, equiv. to gold 1180.  Over sold, prone to bounce but technically bearish below 120 and 123.

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NFTRH; Key ETF Update

A snapshot of current technicals for key markets…

GLD became very bearish with the breakdown from 124.  A rise above 123 is needed to even begin to repair this chart.

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NFTRH; Key ETF Update

A snapshot of the current technical status of key ETFs…

GLD filled gap, which now closes out the geopolitical hype and leaves gold on its own right at key support.  Still not a constructive looking chart.  A rise above the SMA 200 and then the 50 makes it constructive.

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NFTRH; Key ETF Charts

A slightly abbreviated Key ETF segment due to ongoing time commitments over the mid summer weeks.  Just a snapshot in time, picking up where we last left these charts a few weeks ago…

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NFTRH; Key ETF Charts

A snapshot of the current daily chart technical status of several ETFs…

GLD is bullish but in the equivalent resistance zone as noted for gold in NFTRH 296.  MACD and RSI positive, with RSI close to over bought.  Key support is at the MA 50 and 200.

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NFTRH; Key ETF Charts

Key ETF charts are a snapshot to current technicals, not comprehensive technical analysis.

GLD bumped above the lower end of resistance yesterday and is support for any continuing S/T rally activity.  The big test is in the 123 to 125 area and the nose of the former Symmetrical Triangle.

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