The Gold has increased little today, but is trapped below an important resistance area, should increase further on the short term if the dollar’s slump will continue. The price has dropped significantly in the yesterday’s trading session and has invalidated a breakout above an important dynamic resistance, is important to see what will happen with the dollar in the upcoming period.
Gold has dropped in the yesterday’s trading session as the USDX has managed to rebound and to stay above the 99.50 level, the index has plunged today, but has squeezed again and now is trading above the 99.80 level.
The USDX looks oversold on the short term, has found support and now is fighting hard to rebound and to recover, a throwback will send the dollar higher and the gold could decrease again.
The Gold stays higher as the perspective remains bullish, has increased a little as the dollar wasn’t too impressed by the US data, the Unemployment Claims have increased more than expected, the indicator was reported at the 244K in the previous week, higher versus the 241K, Initial Claims have increased significantly versus the 234K in the previous reading period. Moreover the Philly Fe Manufacturing Index has dropped from 32.8 to 22.0 points, much below the 25.6 point prediction, while the CB Leading Index has increased by 0.4%, beating the 0.2% estimate.
Price has failed to stay above the lower median line (LML) of the ascending pitchfork and above the 38.2% retracement level, has come to retest the broken upper median line (uml) of the major descending pitchfork, has failed to close on this former dynamic resistance, signalling that maintains a bullish perspective.
Continues to be trapped inside of an ascending channel, between the lower median line (LML) and the warning line (WL1), we had a false breakout above the LML, so a minor drop is favored. We could see a minor drop along the upper median line (uml) only if the USDX will increase in the upcoming days, maybe he needs more directional energy before will try to resume the upside movement.
Technically, the Gold could increase further after the breakout above the upper median line (uml) of the descending pitchfork.