This is the story of supply and demand within the gold ETF.

Demand = Buyers
Supply = Sellers

The difference between supply and  demand will in the end move prices! Off chart fundamentals may be the reason for price to move but until the supply or demand battle unfolds prices will not move.

The story so far: 

The advance that ended in 2011 ended with a Buying climax. The high volume blue bar confirms that more selling was going on than buying. After such a climax we always get a reaction, the automatic move down to support. These two form the high and low of our expected trading range. Price muddles along this trading range through out 2012. 

- 1 to 2 shows supply coming in
- At 3 demand stood up strong at support. This set a message to the sellers that there was too much demand around to send prices lower. 
- 3 to 4 Supply stood aside and allowed demand pushed prices to resistance.
- At 4 demand did not attract enough strength to push over resistance.
- 5 Saw supply test demand, 
- 5 to 6, supply continued to test demand, and it showed that demand was not present.
- 6 to 7, supply accelerated, knowing that demand was weak. 
- 8 confirmed to supply that demand was very weak at support, and had no force 
- 9 knowing that demand was absent, sellers loaded up with massive supply pushed prices lower.
- 10 was the end of the move, at the time this was a potential selling climax. Potential as volume was not extreme and that a secondary test would be required to confirm the selling climax as a halt to prices going lower. 
- 11 Automatic move after a climax.
- 12 to 13 Supply comes in again .
- 14 Demand notices that supply has less vigor or zip, and pushes price up to resistance.
- 14 to 15 shows that supply has dried up, the selling has stopped.

At the moment the buyers are being very cautious. They do not want to mark prices up if supply is still present in the market place. So far buyers have waited 6 months to ensure that supply has dried up. The question is now that the market is neutral, who will take the lead. Demand has an open door as supply has retreated, but if the buyers do not turn up, the sellers may see an opportunity to drag prices lower, or they may have decided to wait at resistance before having another go.

Expect buyers to test this market, to test to see how easy or not it is to push prices higher. For prices to rise the force behind demand must over come the force of supply.