Gold ETF Charts: Resistance Overhead

By L.A. Little of tatoday.com, author of Trade Like the Little Guy.

Precious metals, particularly gold, have moved up precipitously over the past couple months -- some 16% higher. Is this move for real? Is this the long-awaited breakout where gold simply takes off and doesn't come back? Should you be buying here now?

Historically, you had to trade the commodities markets to gain exposure to gold, but since late 2004, individuals have had the option of purchasing gold via the SPDR Gold Shares ETF(GLD Quote).

Since the latter trades like a stock, has good volume and tracks the spot price of gold (less expenses), I'll use it for our analysis.

On a long-term time frame, the swing high from early '08 was removed last month -- and it occurred with volume expansion. That confirms, once more, that on a long-term time frame, this market is bullish.

The only concern on this chart is that GLD is now at the upper end of the channel. That means that resistance is just overhead, and although GLD could spike further, odds are increasing that it will take a break soon.