Gold Market Wire
News, analysis and commentary for gold traders and investors
US Dollar Reversal Takes Hold
February 9, 2021 - (Gold Market Wire) - The Dollar reversal we identified yesterday is now taking hold in the market. The chart reveals the move:
Now we will see how far the retracement can go. The Dollar low has been put it at 1.235, and we have horizontal support at 1.215. (remember to invert the chart - lower numbers = stronger Dollar)
The game is afoot now, and we will see what the Dollar has in reserve. Was the first 40 days of 2021 just an inside reversal - or the start of something larger? No doubt, we remain in the US Dollar bullish camp...more or less on our own, against a sea of Dollar bears. But, the reversal was clearly marked out - and trading positions should be scaled down and/or flattened now.
A big zoom out will show how the uptrend was line was established.
Stodgy, listless Gold has taken some comfort from the Dollar's retracement - and is putting in a three day power uptrend that is nearly vertical. It bumps into resistance right where it should be expected - at $1850 - which will be its first challenge.
This time around, for the next few trading days, the major downtrend line will also (roughly) coincide with the $1850 marker.
And that's the set up. First and foremost: let's see Gold take on this ling term downtrend...and how much strength the Dollar really has. The market is starting to get interesting again.