While going through my scans, I noticed that the recent pullback in gold had brought it close to being a very attractive buying point here and thought I would share it with you readers.
Firstly, the long term chart. As you can see in this chart dating back to end of 2008, gold is approaching the long term trendline here. It has bounced from it many times in the past and you have to like the odds of it doing so again. Also, buying it so close to the trendline makes us have a close stop position here, giving this play an attractive reward/risk ratio.
Let's have a look at a shorter time frame to get some exact numbers. 115.50 is the trendline support as well as Fibonacci support level. 114 is also an area of strong support and one should consider putting a stop below it if one gets in at the 115.50 levels.
One can go with GLD if one wants to play this setup or if one can stand the volatility, the gold miners, pretty much all of which are oversold right now.
Take care and good luck!