Gold rallies as Dollar falls

The greenback is weakening. The Dollar Index retracement respected resistance at 94, confirming a decline to test primary support at the September low of 91. Follow-through below secondary support at 93 would strengthen the signal.

Dollar Index

The falling Dollar strengthened demand for gold which is testing the band of resistance around $1300/ounce. Upward breakout is likely (Twiggs Trend Index holding above zero indicates buying pressure) and would target the September high of $1350. Breach of primary support at $1260 is most unlikely but would be a strong bear signal for gold.

Spot Gold

The All Ordinaries Gold Index is headed for a test of long-term resistance at 5000 in response to the falling Aussie Dollar and rising gold prices in USD.

All Ordinaries Gold Index

Gold and crude oil tend to rise and fall in unison over the long-term. The primary up-trend in crude prices improves the long-term outlook for gold.

Nymex Light Crude

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s