I’m getting a lot of emails today from frightened members that are bearish on gold and bullish on the US Dollar. It feels like we are reaching an emotional peak; this often occurs near a bottom.
Below is a big picture view of the US Dollar. Prices have broken down below the 200-week MA and are retesting that area now. To me, the rally since February resembles a rebound after an extended 12-month decline and nothing more. Prices would have to rally above the 61.8% retracement (98.00) and stay above the 200-week MA to suggest otherwise.
-US DOLLAR- After a sharp 12-month decline the dollar found support near 88. Prices are below the 200-week MA (bear market) and are retesting that level now. Prices haven’t even reached the 50% retracement level of the 2017 decline. However, technically speaking, prices remain in an uptrend until they break below the long-term (red) trendline. The dollar would have to rally above the 61.8% retracement (98.00) and stay above the 200-week MA to restore its uptrend. I believe we are transitioning into a bear market and that this is just an oversold rebound. I expect prices to peak and eventually breakdown below the long-term (red) trendline.