Loading ...Dollar And Gold – Resistance Is (Probably) Futile
With the dollar sitting on a multi year support/resistance line, and gold simultaneously trying to push through one, we’re on the verge of a simultaneous resolution which may well be explosive in nature. The third chart below shows two of the indicators for gold (I needed to maximise the size of the gold chart to show everything properly). The balance of evidence suggests a dollar breakDOWN and a gold breatOUT is underway. As I’ve said before, a dollar bounce and gold drop are quite possible here, but the primary trend SHOULD be dollar down, gold up.
Best yet Northstar thanks. Nice clean concise lines in the sand.
Thanks Fully. As you know, I’m undecided about the very short term, but believe this will resolve upwards for gold. Bull or bear, whichever you believe, these are the timescales, and, as you say, ‘lines in the sand’ that will reveal all for us.
Thank you Northstar. Nice work!
Cheers PC. I’m trying to stay open-minded here and allow for the possibility of a dollar surge/gold dump. It may happen, but time (and those indicators) are arguing against anything too drastic. Luckily, I don’t trade much. I’m more of a ‘buy and hold’ until the next significant trend change.
Thanks for this post, Northstar. Your charts here are simple, to the point, and I agree with your analysis.
It’s very hard for me to look out two or three years and be bearish on gold. Everyone with one eye and half a brain knows the federal debt cannot be repaid in real terms. The US Government can (a) openly admit that it’s near bankrupt and will have to make HUGE cuts (25%+) to its spending, or (b) tell the Fed to buy their bonds and pay for them with multi-billion dollar mouse-clicks.
It should be obvious which choice they will make.
I think we will see GOLD go to 1270 and the dollar rise before Gold makes a move.