03/31 - GOLD probes triangular resistance

Gold rebounded off the resilient RSI base last week, highlighting a multi-month triangular consolidation formation. Today's test and subsequent failure of breaking above trendline resistance was aided by 4-hourly bearish MACD divergence. Coincidently, Eurogold has formed a smaller, but similar-type consolidation triange. As the US Dollar enters April, one of the worst month's seasonally, there is a strong probability that Gold could breakout to the upside. Moreover, other commodities (such as Crude oil) also hint of a breakout of recent ranges. Gold's first target would be the March 17th peak at 1133, also near a 50% retracement level. If, however, the yellow metal fails to break triangular resistance, then formation support at 1096 would be initially targeted.

03/26 - GOLD buoyed by RSI base & t-line support

200-day moving average MOVING faster than equity indices

03/24 - Fifth wave targets for DXY & EUR/USD

Both the DXY (US Dollar Index) and the EUR/USD have confirmed the fifth wave of an Elliot wave series that originates from November 2009. While 4-hour MACD divergence and the key 10-week MA initially stalled the greenback's weakness last week, it was the subsequent daily RSI wedge breakout that enabled dollar bulls to seize control.

One common method of determining a fifth wave target is to project the length of the first wave (or a proportion of that wave) within the series and project it from the start of the fifth wave. Beyond a cluster of DXY Fibonacci retracement level's near the 82 handle, the first fifth wave target lies at 1.3247 (a .618 proportion of the first wave). In both cases (DXY & EUR/USD), the equality target coincides with important levels at 83.714 & 1.2879, a combination of key Fibonacci retracement levels, Gann targets and swing pivots.

03/17 - Daily RSI key to dollar direction

The DXY (US Dollar Index), EUR/USD and USD/CHF have formed wedges within their respective daily RSI oscillators. The latest trend of dollar weakness should continue while these formations remain intact. A substantial move above the EUR/USD's 10-week MA at 1.3804 would shift the immediate focus to 1.3853-1.4025, an Elliot wave target region (also near the 38.2 & 50% retracement of the downleg from the Jan 13th high). Above 1.4211, however, negates the current wave count and would suggest a medium-term trend shift. Meanwhile, while 4-hour bearish MACD divergence has triggered a correction off today's high, a substantial loss of 20-day MA support at 1.3635 (along with a breakdown of the aforementioned RSI wedge formations) is required to reignite dollar bulls.

03/12 - Why Gold is falling

To better understand why Gold is falling while equity indices continue to grind higher, take a look at Gold priced in foreign currencies. While Gold peaked at record highs late last year, it reached new all-time highs (vs the euro and pound sterling) just last week. Since then, however, the yellow metal has steadily moved lower. This is due to the fact that the euro & pound have recovered vs several foreign currencies (including the dollar, yen & aussie). Daily bearish RSI & MACD divergence has triggered EURO/GOLD's retreat that now looks set to test 785.00 (near the 100-DMA & bull channel support). Meanwhile, Gold (in $'s) could find solace near the important RSI (9-period) base at 31, which provided support in December (2009) and last month.

03/11 - Aussie's wedgie

The Australian Dollar is trading within a wedge formation vs the US Dollar, British Pound, Japanese Yen and the euro. Price-action is also diverging against 4-hourly MACD, which hints of a possible reversal. Below .9140 (AUD/USD) will confirm that a larger correction is in store. Meanwhile, a daily close above .9170 (AUD/USD) suggests further strength and could trigger a possible retest of .9334 (January highs).

03/02 - Euro bulls eye the 20-day MA

While concerns over European sovereign debt persist, euro bulls have several technical reasons to be optimistic. Despite marking a fresh 2010 low, the EUR/USD's subsequent snapback continues to respect a key Fibonacci retracement on a closing basis (1.3486 - 61.8% of the March/December 2009 rebound). Moreover, today's marginal break of 1.3444 (last Friday's low) could now potentially mark a double bottom (above 1.3690 confirms).

Daily bullish RSI & MACD divergence and ongoing pressure of the 20-day MA suggests that the single currency is demonstrating tentative signs of a base against several major currencies (Japanese Yen, Swiss Franc, Norwegian Krone and Canadian Dollar).

Clearing the resistant 20-day MA (EUR/USD 1.3647, EUR/JPY 122.83, EUR/NOK 8.0853, EUR/CAD 1.4386, EUR/CHF 1.4654) is now required to stage further strength. Conversely, a sustained loss of the DXY's (US Dollar Index) 20-day MA at 80.32 could trigger an overdue correction.