A month ago it looked like the U.S. Dollar Index would crash through its 1-year support line. Instead, the index bounced off it like an Indian rubber ball (remember?) and, in the process, hurt the price of gold and silver. That seems to have reversed in the past few days. Take a look at the charts. Words: 431; Charts: 2
The 2 charts below are from Chris Kimble and show the “now” and “then” movements of the U.S. Dollar Index.
a) The U.S. Dollar Index closed out on Tuesday at 80.35 DOWN marginally from 80.50 last Friday and but is still above its 50-day moving average of 80.22.
b) Gold closed out on Tuesday at $1,659.10 UP marginally from $1,658.40 the previous Friday but is still marginally below its 200-day moving average of $1,662.91.
CLICK ON CHART TO ENLARGE
a) USD Index: The long-term chart below showed a potential bearish Head and Shoulders pattern which did not materialize. On Thursday, December 20th, the U.S. Dollar Index closed at 79.26 (intraday low of 79.01) marginally below its 50-day moving average of 80.16.
b) Gold Price: Gold closed December 20th at $1,645.90 (intraday low of $1,636.00) well below its 200-day moving average of $1,663.07.
a) Check out this chart for the daily U.S. Dollar Index moves as the days unfold and
b) this chart for a look at gold’s performance over the next few days.
Note: You are also encouraged to read Rick Ackerman’s excellent article on the above subject entitled Bullion vs. the Dollar: Three Scenarios.
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The U.S. Dollar Index took a breather on Thursday on its apparent way down and through its support line of 79.00 closing the day at 79.26 vs. 79.27 on Wednesday well below its 50 day moving average of 80.16.
Gold has done it! It took 11 yearrs but it finally (albeit unfortunately) crashed through its channel support line of $1,690.00 and 200-day simple moving average of $1,663.07 to close out Thursday at $1,645.90 (with an intraday low of $1,636.00) down $22 from the previous day. Tomorrow is December 21st, 2012, the day the Mayan calendar predicted the world would experience an apocalypic event, so might we be in for a further major decline (just kidding) decline?
My previous article on gold & silver went viral with almost 30,000 reads on munKNEE.com alone and continues to be read by hundreds of goldbugs daily. Below is an updated chart and analysis suggesting that gold & silver have further to drop before they go parabolic. Take a look and share it with friends.
If you’ve been waiting for a time to add to, or to initiate, a precious metals position, this is exactly what you’ve been waiting for. [Let me explain why that is the case.] Words: 299; Charts: 1
[Here is a summary of my]…thoughts on the 2011 gold price peak relative to the last time a long term bull market ended (back in 1980): Long-term bull markets almost always end with a bang, not a whimper, and last year’s price peak was clearly the latter. A 25% rise over a period of about two months last year [does not an] end-of-cycle, blow-off top [make]. No, I think there’s still some room to run for gold if for no other reason than that we haven’t even come close to the “mania” stage that characterizes the end of long-term market moves…[Let me explain further.] Words: 359; Charts: 1
Gold probably has one more curveball to throw us before the final yearly cycle bottom is in which should see it set one more marginal new low to say around $1630 in the next couple of weeks after which I think gold will easily test the $1900 level during its next intermediate cycle. [Let me explain why I have come to that conclusion.] Words: 350; Charts: 1