Here's my quick chart update for gold (GLD) showing possible bearish pattern underway

Gold has been working out a potentially bearish (as in, very bearish) pattern on its daily charts. I've tweeted about this and we know that Andre Gratian has also been covering the gold swing trade chart in his Turning Points updates. In fact, check out the immediate prior this morning, with Andre's Turning Points update report - it includes this. The risk is that gold has completed (or in process of completing) a bearish wedge fifth-wave top of a significant level. The negative divergence Andre noted (and I've tweeted about last week, and shown on the GLD chart (gold ETF) at right) helps to depict bearish potential for a sizable drop in the gold price.

One theory could be that as gold falls out of this bearish pattern, stocks will rise. Many others would theorize however, that gold and stocks will rise - or in this case, fall - together.

This isn't merely a chart pattern, although the pattern is a concerning one because wedges of this sort often cultimate in a violent move away in the opposite direction. What adds to the bearish picture are the negative divergence in the RSI, which has failed to make higher highs as price has edged higher. As well as the selling volumes - if you look at the volumes in GLD, above right, you'll see that volume on down days has been picking up noticeably, even including today so far.

Whether you are a gold "bug", gold investor, or gold trader, the potential for a very bearish move in the gold price is something to be aware of. Be sure to look at Andre Gratian's technical analysis of gold in that Turning Points report, too (that one I pointed out, posted here this morning). If this pattern - as I've marked on the GLD chart above right - "works out," then GLD and the gold price should have a very significant, deep drop over the coming weeks. Such as GLD testing under $114, and later testing $102. Furthermore, if this bearish ending diagonal triangle (EDT) wedge represents a fifth-wave top, then potentially even deeper levels will be very possible over the coming weeks.