Gold Market Update
The dollar chart looks terrible and although the Plunge Protection Team may make a last ditch effort to keep it creaking along until the election, it looks doomed. If the dollar index breaks decisively below 87, it is likely to drop sharply. This is the event that should catapult gold above the key $430 resistance level, and is what gold appears to be waiting for.
Gold's action in recent days has been positive. A bullish hammer candlestick formed when it dropped steeply intraday some days back and closed near the high for that day. This action appears to confirm a steeper uptrend channel, alluded to in past updates as a possibility and now drawn on the accompanying 1-year chart. This steeper uptrend channel, with its topline already above the key $430 resistance, allows for an immediate breakout drive above this level in the event of the dollar breaking lower, which could happen anytime now.
The dollar should now be watched closely for a steep decline.
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