Dollar Index is losing trendline support – Gold is breaking out

The Dollar Index failed to hold the rising trendline support of the triangle on the near term 30 minute chart, see left hand side below.  This trendline was identified early in this past weekend’s update on the Dollar Index.

The dominant pattern is still the bullish “Cup with a handle” on the weekly chart.  The Bulls are struggling with the extended neckline support there and failed patterns are very strong signals.

The link to this past weekend’s update on the Dollar Index can be found here.

Moving on to the precious metals, they are breaking out of chart patterns that were identified in this past weekend’s updates as well.

The latest post on silver from last night can be found here.

In Gold, the left hand side one hour chart highlights in the blue oval a textbook breakout from a tight consolidation pattern that was clearly seen on the smaller degree timeframe this morning.  This took place right at triangle resistance which is the ideal trade setup.

The right hand side chart below highlights the breakout of the triangle pattern on the daily chart.

It’s been a while since gold has looked this bullish and I imagine the gold bugs will be coming out of the woodwork.  The important thing to remember for me is to stay disciplined and follow the trade plan with the proper “risk management” and “money management”.  Leave emotions out of trading decisions.

Let’s see how the metals finish today in terms of the close and the end of the day volume.

It is important to note that gold is approaching major trendline resistance.

The weekend update on gold can be found here.

Further details about the new service were sent out this morning to those on my list.

Consulting? ScottPluschau@gmail.com

 

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