What Do Recent Moves In The U.S. Dollar Mean For Gold?
The Gold Report | Jun 01, 2016 02:07AM ET
Technical analyst Jack Chan offers an interpretation of the correction in progress in the gold sector.
Gold stocks remain on short-term sell signal, and if we are in a bull market, prices should find support at the 200ema, which may be an excellent entry.
The divergence as noted in the last report has resulted in lower prices in both gold and gold stocks.
iShares Silver (NYSE:SLV) – we took profits on our short position and will wait for a new set up.
With one session left in the month, the US Dollar Index bounced off the lower trading range of this over a year-long consolidation with an outside reversal monthly candlestick, which suggests that the correction is complete and more strength ahead in coming months. A rising dollar is not friendly to the metals.
Summary
A correction is in progress in the gold sector, while the cycle has just turned down recently. Expect lower prices overall until the cycle bottoms and COT data becomes favorable.
Disclosure:
1) Statements and opinions expressed are the opinions of Jack Chan and not of Streetwise Reports or its officers. Jack Chan is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation or editing so the author could speak independently about the sector. Jack Chan was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
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