The gold price is being squeezed between its rising support line and its 200-day moving average. The chart below shows that over the past year, when bulls have successfully defended support, the squeeze has lead to a very tradeable rally on the long side. Should a downside break occur, bulls may find support at the $1,785 level for starters.
It seems as though a bounce in stocks is underway; this may be the one that tests the bears' conviction. The SP looks ready to move back up to test resistance at its 50-day moving average (orange), coinciding with what may become minor resistance. Should the index breach to the upside, the next level is likely the 200-day moving average (blue) in what could become major resistance as it coincides with the top trendline.
Another look at the dollar shows that it may also be ready for an encounter with its moving average (or averages)?; which would be to the downside. The dollar has found resistance at the top of the channel we have been presenting for some time.
Thanks and have a great weekend,
