Gold Looks Solid

Includes: AU, BVN, EGO, GFI, GG, GOLD, IAG
by: Jeff Pierce

I like gold, and it’s important to be aware of the negative divergence that’s going on right now between price and RSI. I’ll be watching to see how we react when we hit the 1270 area and see if it proves to be an area of resistance.

If we blow right through it we’re heading much higher. If gold gets rejected at this trendline then we could be in for a period of consolidation or possibly a pullback.

The latter seems unlikely given how strong the overall trend of this 2yr chart is (click to enlarge). Here are a few of my favorite gold stocks based on relative strength:

AngloGold Ashanti (NYSE:AU), Compania de Minas Buenaventura (NYSE:BVN), Eldorado (NYSE:EGO), Gold Fields (NYSE:GFI), Goldcorp (NYSE:GG), Randgold Resources (NASDAQ:GOLD), Iamgold (NYSE:IAG).