Choppy Action Expected for SPDR Gold Shares (GLD)

June 18, 2012 8:26 AM EDT
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SPDR Gold Shares (NYSE: GLD) is expected to open lower on Monday, as gold futures track lower. The move lower is directly tied to positive results in the Greek elections. Bulls were hoping a leftist party victory there would force central bankers to rush to provide liquidity. As it is, the pro-austerity party won and central banks may or may not provide further quantitative easing. As expected, the price action in Asia on Monday was extremely choppy.

The short term trend in gold remains upwards, and the fact that support at 1600/oz is holding up may allow longs some protection when entering at currently levels. However, many traders are preparing for more choppiness in the days ahead, and a range-bound pattern could emerge.

Importantly, the FOMC meets on Wednesday this week.

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