opinion

Gold bulls hold the line before impending rate hike

Kitco Media
By Jonathan Da Silva
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The SPY looks to be on the brink of finally closing the remaining downside gap we have been highlighting since we proposed stocks had topped again (for the medium term) in mid-august, at major resistance.

Gold bulls continue to hang on to $1650 - 75 in the face of an ever-rising and resilient DXY; note that the negative divergence between price and RSI in the DXY remains well intact.

At the same time, the gold to silver ratio looks like it could be forming a top on the monthly timeframe around Fibonacci resistance.

Of course, with the impending FOMC meeting Wednesday, it remains to be seen whether Jerome Powell will provide the market with "reason" to send the DXY up to tag the upper resistance line shown in the chart above at around 115. Should that occur, it would put price action in the DXY in near parabolic territory, which to a contrarian USD trader, may be a beautiful site to see.

Thanks, and gave a great week.

Kitco Media

Jonathan Da Silva

Jonathan Da Silva developed a passion for hard money and economics from a young age having been influenced by family who sought to teach me that "nothing is free", and the importance of intrinsic value early on. My interest in markets grew keener during the great financial crisis of 2008; leaning on family with vast trading experience, I began to self-educate on technical analysis and economics- drawing inspiration from the works of individuals like W.D. Gann and Adam Smith. I have been a proud member of the Kitco team since 2017 and hope that my writing inspires readers to consider an objective view of the metals, and the greater financial markets.

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