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« Kinross Gold Corporation Re-visited 14th April 2008 | Main | Gold: Heading for calmer waters! »
Sunday
Apr132008

Gold and The US Dollar: Too Close To Call

Both the US dollar and gold are at key short term turning points at the moment.

Gold: Too Close To Call
The US Dollar: Too Close To Call

The USD is forming a triangle channel which we think it will break out of within the next week or so. However the technical indicators have yet to provide a clear signal on which way the USD will break. The obvious answer which most gold bugs will say almost instantly, is down, down, down!” as this has been the trend for quite some time now. But we never assume anything about the market and we think that we are nearing a stage where the market is becoming too pessimistic about the US dollar and therefore we could be in for a short term rally in the greenback. This doesn't change our opinion that the USD is in the middle of a serious bear market, but even bear markets have their rallies!

This would fit with our opinion that gold still needs to fall further in order to reach a point where a the next leg up of the bull market can be started. Gold prices appear to be meeting a short term resistance line and we would need to see a breakout significantly above $950 to see this line penetrated. If this doesn't happen then we think gold prices will slide down to find support at $875 for a while.

Gold is currently in the midst of a correction/consolidation phase and so we do not see any great trading opportunities as of yet. We are sitting with some cash on the sidelines patiently waiting for such opportunities to present themselves, but for now all we can do is wait and watch.

Sit Tight.

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Reader Comments (5)

Why do you publish dated articles? I see a headline such as "Yamana: BUY" click on the article and see the date it was written was 9-07-06 ?????

April 14, 2008 | Unregistered CommenterDave Wilson

hi,
i'm thinking about buying into mining stocks in a pretty big way in the near future but i've had some trouble buying on some exchanges and getting the best prices with my current broker.
therefore i was wondering if you could say what broker(s) you use. any info would be greatly appreciated.

pete

April 14, 2008 | Unregistered Commenterpete

Dave, We had a request from our readers to group articles together in order to save them the time of searching through the site to see what we had previously wrote. It appears to work well for individual companies such as AEM but when it comes to articles of a general nature it is not so good.

We are trying to find new ways of improving the site as we go but we still have a long way to go.

April 14, 2008 | Unregistered CommenterGold Prices

Pete, We are not financial advisor's so we can not answer your question, you could ask some of your friends and see if they have had good service from their brokers.

April 14, 2008 | Unregistered CommenterGold Prices

hi,
I understand that you're not a financial advisor, but it would just be interesting to know what stock brokers other people use so that i can research those companies myself. i don't think that really constitutes giving financial advise. besides, you give out details of your trades, so i don't see the problem in saying what brokers you use.
Regards,

pete

April 16, 2008 | Unregistered Commenterpete

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