After impressive starts to the year, gold exchange traded funds have lost momentum. Over the past month, the SPDR Gold Shares (NYSEArca: GLD), the world’s largest ETF backed by physical holdings of gold, is off 5.9%.

Ongoing strength for the U.S. dollar, among other factors, has hampered gold in recent weeks. Fueling the appreciating greenback, an ongoing currency war among international central banks has caused many foreign currencies to depreciate. For example, the Danish and Swedish central banks have shifted to negative interest rates this year. [Dollar ETF Rules Currency Wars]

Now gold futures, and as a result ETFs such as GLD, are in an interesting technical position that suggests a big move could be afoot.

“In the last 15 years gold is up 4X over its 2001 lows of $250 per ounce, however the last 3 years have been rough with it losing over a third of its value. Many continue to debate if Gold is in bull or bear market. Personally I am not big on labels, I care much more for being on the right side of a price trend,” notes Chris Kimble of Kimble Charting Solutions.

As Kimble notes, pennant patterns are not good predictors of what direction a big move is going to occur. The pattern merely suggests that such a move is coming, so investors should approach near-term gold ETF trades with some caution.

Some investors remained unfazed by gold’s weakness last month and continued pouring money into gold ETFs. In February, GLD hold in over $538 million in new assets while the Market Vectors Gold Miners ETF (NYSEArca: GDX) took in $352.6 million in new money despite sliding more than 5%.

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