GOLD REACHES HIGHEST LEVEL IN SEVEN YEARS -- WHILE ITS MINERS MAY ALSO BE BREAKING OUT -- GOLD MINERS ETF IS ALSO SHOWING RELATIVE STRENGTH AGAINST THE METAL AND STOCK MARKET

GOLD REACHES SEVEN-YEAR HIGH... Gold seems to have everything moving in its favor.   Low global interest rates, a softer dollar, and fears of global economic recession.  And most of all, a bullish chart pattern both for the yellow metal and its miners.   A lot of bullish articles on gold have been posted on this site over the past year; so the fact that gold is hitting multi-year highs shouldn't come as much of a surprise.    The monthly bars in Chart 1 show the Gold Shares SPDR (GLD) trading this week at the highest level since the start of 2013.  Moving average trends on its daily and weekly charts remain positive.   As do its monthly MACD lines (middle box).   The only cautionary note is its 14-month RSI line (upper box) moving into overbought territory over 70 for the first time since 2011.   That may suggest that the gold rally is becoming over-extended on the upside; but doesn't pose any serious threat to its ongoing uptrend.

GOLD MINERS MAY ALSO BE BREAKING OUT...It's normally a positive sign for gold when its miners are rising along with it.  And they appear to be doing just that.  The weekly bars in Chart 2 show the VanEck Gold Miners ETF (GDX) trading today above its 2016 intra-day high at 31.06.  An upside breakout would put the GDX at the highest level in seven years.  In addition, gold miners are showing better relative strength against the price of gold and the stock market.   The upper line in Chart 2 shows the GDX/S&P 500 ratio breaking out today to the highest level in four years.   The GDX/GLD ratio in the middle box still hasn't achieved an upside breakout.  But the miners/metal ratio has been rising over the last month.  That's another positive sign for gold.