With equity markets notching new all-time highs, gold has failed to accomplish the same feat.
With equity markets notching new all-time highs, gold has failed to accomplish the same feat. The SPDR Gold Trust (GLD) trades on two consecutive buy signals but saw its fund score drop below 3.0 for the first time since December 2022 after Tuesday’s market action. Over that period, GLD posted a return of 160.60%, more than double the S&P 500’s 79.23% return over the same period. Despite GLD’s sub-three fund score, the technical picture is not all bad, as previously mentioned, it trades on two consecutive buy signals. GLD is also up over 8% this year despite being roughly 13% from its all-time closing high. Action since the fund put in a near-term bottom a month ago suggests indecision for both buyers and sellers. Buyers have yet to push the fund back above prior support, now acting as new resistance. On the other hand, sellers have not shown much conviction since GLD found support at $400, a level that has seen its importance solidified over the last month. For those that have substantial gains in GLD and are not open to selling now, $400 is the key level to watch moving forward.
One of the reasons GLD’s fund score has fallen is that it gave an RS sell signal versus the market (SPXEWI) in March. GLD had been on a buy signal from October 2024 until March 2026, a period which saw the fund gained 59% while SPXEWI gained 6.83%. There have been head fakes historically for this RS relationship, including its last sell signal in February 2024. Overall, GLD is a rare case where the weight of the evidence isn’t fully clear despite a sub-3.0 fund score and RS sell signal. If clients have seen their gold exposure grow well beyond the target, it is a great time to rebalance. However, fully selling out of gold exposure may be premature at this point given the lack of major deterioration on its trend chart coupled with its exceptionally strong run over the last few years. As mentioned earlier, action below $400 on GLD would change this viewpoint and would be a point where the weight of the evidence would be negative.
