Its 6.00am UK time and the USD is drifting south in Asian Markets as the above chart of the dollar shows and inversely gold is heading north to trade around the $1107.60 and silver is also shaking a leg up $0.21, as we write.
As we mentioned on the 10th February 2010 when gold was sitting at $1076.70:
In recent trading, gold prices appear to have made a declining wedge formation, which is good news for gold bulls since a falling wedge formation after an uptrend usually means a break out to the upside, rather than one to the downside. In addition to this, technical indicators such as the MACD, STO and RSI are in oversold territory. So whilst there could still be some sideways action ahead, it appears that the worst of this correction is over and an excellent buying opportunity is upon us.
So we now have gold pushing up against the top of the channel of the declining wedge and hopefully it can break through and set us on the road to another rally, which would lift stock prices and set fire to our Call Options.
All the best.
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