Conclusion, Investment Implications, Strategy
The SPDR Gold Shares ETF (GLD) is amid favorable technical / quantitative conditions to continue its recent trend of outright strenth amid relative outperformance versus the benchmark S&P 500.
Current Sector & Industry Group Ideas
Table 1 below is also accessible via the Sector & Industry Group Ideas rectangle at the top of the Research Center.
Click the table to make it larger
This table also regularly appears in our weekly Keys To This Week: Sector & Industry Groups report published on Monday mornings.
Analysis and Rationale
The upper panel of Chart 1 below plots the SPDR Gold Shares (GLD) ETF daily since May along with its 50-day moving average, a widely-watched minor trend proxy. The lower panel plots the corresponding daily relative performance of GLD versus the SPDR S&P 500 ETF Trust (SPY) along with its 63-day moving average, which we use to identify the Strategic (quarterly) trend of relative performance versus the broad market.
The green highlights in the upper panel show that GLD moved above its 50-day moving average as of Oct 13th to indicate a bullish minor trend change. The lower panel shows that GLD is also in an Oct 12th emerging trend of Strategic relative outperformance versus SPY.
The upper panel of Chart 2 below plots GLD daily since July with its 200-day moving average (major trend proxy), with a corresponding chart of the daily total net assets invested in GLD (AUM) and their 21-day moving average in the lower panel. We use the 21-day MA to determine these assets’ Tactical (monthly) trend.
The green highlights in the upper panel point out that GLD gapped above its 200-day MA on Oct 18th to suggest an emerging major bullish trend change. Meanwhile, the green highlights in the lower panel show that these assets are in the midst of an Oct 13th emerging trend of monthly expansion,
This combination of a bullish major trend, Strategic relative outperformance versus the S&P 500, and Tactical asset expansion indicate favorable conditions for a continuation of recent strength and relative outperformance by GLD and the gold-related assets it represents.