The Fidelity Select Gold fund (FSAGX, change: -3.68%) dropped into bearish territory today, as the gold bullion sold off on high volume mirroring the sell off in global equities. In the last three months, gold investments did not offer a hedge against stock market declines.
Gold bullion (see the GLDETF) broke above the already steep uptrend resistance line and accelerated to a break-neck speed.
The uptrend of the SPDR Gold Shares (GLD) ETF is accelerating.
The Fidelity Select Gold fund (FSAGX) closed up 2.19% on Friday and was the best performing sector fund. However, the price pattern of FSAGX shows divergence compared to GLD. FSAGX will need to break above the April highs to resume its uptrend. It is also possible, that the divergence is an early warning, which signals that the speculative bubble in gold bullion will not continue on the long term.
The Fidelity Select Gold fund (FSAGX) is up in a weak market, but still in a trading range.