Gold is trading in the red right now and could drop much deeper if the USD will increase versus its rivals. However, you should know that this could be only a temporary drop. Price could only test and retest the near-term support lines before it will jump much higher. It has found a temporary resistance right now, so the current drop is understandable.

It is really important to see what will happen with the USDX in the upcoming days because a failure to climb higher will announce a USD decline and a Gold increase.

USDX has decreased again in yesterday’s session and has failed to close above the 97.54 static resistance (former high). The yellow metal has increased a little today, but this could be only a temporary increase and the rate will drop towards the upside 50% Fibonacci line again.

The US data have come in mixed earlier, the Unemployment Claims dropped from 233k to 206K in the previous week, the indicator has come much below the 226K estimate, but unfortunately, the Import Prices drop by 1.6%, much more versus the -1.0% estimate.

You can see that the Gold has found a temporary resistance at the intersection between the 150% Fibonacci line of the descending pitchfork and with the inside sliding line (sl2) of the ascending pitchfork. A valid breakout above the sliding line (sl2) and above the 150% line it will confirm a further increase towards the median line (ml) of the ascending pitchfork.

Technically, it is somehow expected to increase a little after the failure to test and retest the inside sliding line (sl) and after the valid breakout above the upper median line (uml) of the descending pitchfork.

It could increase further also because it has closed near the second sliding line (sl2). We can go long if the rate will make a valid breakout above the 150% line and above the sl2.