US Dollar’s February Uptrend Intact For Now; Gold At Fresh Yearly Highs

GOLD PRICE CHART: DAILY TIMEFRAME (DECEMBER 2017 TO FEBRUARY 2019) (CHART 1)

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US Dollar's February Uptrend Intact for Now; Gold at Fresh Yearly Highs

When we last checked in on Gold prices we said that “price action as we make our way through mid-February suggests that recent losses have been corrective in nature rather than an indication of a trend change. For the bull trend to restart, Gold prices will need to clear out Wednesday’s inverted hammer high at 1318.02.” Indeed, with Gold clearing out the February 15 high, prices restarted their uptrend, ultimately pushing to a fresh yearly high today. The high/low range of the consolidation that took in the first two weeks of February had a range of approximately $23, suggesting that Gold’s first upside target is the measured move near 1348.

DXY INDEX PRICE CHART: DAILY TIMEFRAME (JUNE 2018 TO FEBRUARY 2019) (CHART 2)

(Click on image to enlarge)

US Dollar's February Uptrend Intact for Now; Gold at Fresh Yearly Highs

The first gains in three days is helping the DXY Index stave off a close below its daily 8-EMA, in what would be the first close below said moving average since February 4. But there is still sufficient technical evidence for caution, even if the DXY Index’s uptrend is intact for now: the bearish outside engulfing bar from Friday effectively puts a near-term ceiling on price action at 97.37. Only a breach to the topside would reinvigorate the near-term case for the DXY Index to continue the rally outside of the symmetrical triangle, targeting an ultimate return to the November and December 2018 highs near 97.72.

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