I have been away for a week, so thank you for your patience. The last time I wrote, I cautioned that gold looked increasingly like a weekly close under $1935 would transpire. Although bulls have clearly lost that battle putting the brakes on a rally to $2100, I am still giving bulls the benefit of the doubt that a reversal back over $1935 could transpire this week with a slew of economic data on the horizon.
The daily candles are forming a pennant, and momentum is still oversold while the price remains supported above the June 29 low. I have also posed this question regarding Bitcoin, and the same outlook, I think, applies to gold here: What doesn’t go down must go up?
As for Bitcoin: Bears continue to be disappointed as the price moves sideways with major congestion at 30k. A breach of that level with conviction would likely ignite a rally back to 32k. Over 32K? bears will be faced with major pain, in my opinion. You don’t have to be long, but being short may be reckless.
Below is the daily chart of DXY. The yellow highlighted area shows the breakdown from the flat side (yet another flat side break) but also a reversal back into consolidation. With daily momentum hitting overbought, participants should be on the lookout for the dollar topping with another low high, this time with the 200-day MA acting as further resistance.
Thanks, and have a great week.
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