Gold Stocks Index – The Leading Indicator for Gold Bullion
I watch the price of gold stocks very closely because when there is large divergence from the price action of gold bullion I can get in a trade before the general public does.
Tuesday we saw gold stocks put in a powerful rally yet gold bullion did not move much. This told me there was going to be some positive action Wednesday in gold and there was a very nice rally, indeed.

This monthly chart of gold stocks shows a monthly breakout which is exciting to see. Most rallies last between 3-6 months on a breakout like this. That being said we could still have another 1-3 months of sideways price action as gold bullion tries to clear out the over head supply.

Gold Bullion – Monthly Timing Chart
The gold chart clearly shows that we are near a major breakout. You can also see the similar price action before the last major breakout which is encouraging.

GLD Gold Bullion Trust – Weekly Timing Chart
Gold has broken out of is bullish pennant and now trying to break through the overhead resistance. So far the price action is strong but do not expect a breakout instantly. The market always has a way of dragging things out much longer than one may anticipate.

GLD Gold Bullion ETF – Daily Timing Chart
The daily chart clearly shows that if we continue to form a bull flag or some type of pennant formation it major breakout could takes weeks from here.