This might just currently be my chart of the week; one I will be monitoring very closely this coming week. We can firstly see the clear inverse correlation between the USD (US Dollar Index) and the Gold Price. More importantly, with the little bounce we have seen in the USD this week, the US Dollar Index now finds itself at a strong resistance level. Not only did we see it struggling to break through the 50-day Moving Average (EMA), but also now find it back to the resistance level which formed since the USD started to weaken in March 2020.
Should we see the US Dollar Index break and close above 93.80, we could very much see it recover to 94.60 over the shorter-term, with the 200-day EMA (at 95.85) coming back into play. Should the US Dollar Index move back to 94.60, could see the Gold Price back between $1850-$1855, with a move back to 95.85, most probably see Gold struggling to maintain the $1800/oz levels.
The 14-day RSI is not close to being oversold yet and the momentum is still very much against the US Dollar Index. Should the resistance hold and we see a pullback, levels to watch will be both the 8- and 21-day EMA’s at 93.56, with a break and close below this level bringing back into play the very dangerous short-term support-level at 93.20. A break a close below this level would have me monitoring 93, with a break and close below this level, bringing back August lows (of 92) into play. A short-term move to 93.20 this week, can see the Gold Price back at $1925/oz.
Should we see the US Dollar Index break and close above 93.80, we could very much see it recover to 94.60 over the shorter-term, with the 200-day EMA (at 95.85) coming back into play. Should the US Dollar Index move back to 94.60, could see the Gold Price back between $1850-$1855, with a move back to 95.85, most probably see Gold struggling to maintain the $1800/oz levels.
The 14-day RSI is not close to being oversold yet and the momentum is still very much against the US Dollar Index. Should the resistance hold and we see a pullback, levels to watch will be both the 8- and 21-day EMA’s at 93.56, with a break and close below this level bringing back into play the very dangerous short-term support-level at 93.20. A break a close below this level would have me monitoring 93, with a break and close below this level, bringing back August lows (of 92) into play. A short-term move to 93.20 this week, can see the Gold Price back at $1925/oz.
Trade active:
93 breached. Seems like $1925 is next up for Gold.