Several interesting developments on the Currency Rotator today worthy of note: first, the Canadian dollar has migrated to slot #1, a likely reflection of flight to safety, although volume on this ETF has been light. A little disparity between GDX and GLD with GDX the clear momentum… again on light volume.
Perhaps surprisingly,GDX’s beta is .74 while GLD’s .o5. We’ll look at the causes for this disparity in a future post, but for now the beta factor is likely skewing the performance results.
Of greatest interest is the TLT situation. After a major breakout on Monday and a modest follow through today the technical indicators are strongly suggesting a pullback is in the cards. I mentioned a 105 short term high target for TLT on Monday, a goal that’s now been hit and held. Prior to any further gains in the TLT I’m therefore expecting a retrace back to the LR30 upper channel band around 101.50. Volume in TLT was notably heavy today further suggesting a short term top might be in the making.
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