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What Recent Moves In The US Dollar Mean For Gold

|Includes: GLD, iShares Silver Trust ETF (SLV)

Technical analyst Jack Chan offers an interpretation of the correction in progress in the gold sector.

Chan 1

Gold stocks remain on short term sell signal, and if we are in a bull market, prices should find support at the 200ema, which may be an excellent entry.

chan2

The divergence as noted in the last report has resulted in lower prices in both gold and gold stocks.

chan3

SLV - we took profits on our short position and will wait for a new set up.

chan4

With one session left in the month, the US Dollar (NYSEARCA:USD) bounced off the lower trading range of this over a year-long consolidation with an outside reversal monthly candlestick, which suggests that the correction is complete and more strength ahead in coming months. A rising dollar is not friendly to the metals.

Summary

A correction is in progress in the gold sector, while the cycle has just turned down recently. Expect lower prices overall until the cycle bottoms and COT data becomes favorable.

Jack Chan is the editor of Simply Profits, established in 2006. Jack bought his first mining stock, Hoko Exploration, in 1979, and has been active in the markets for the past 37 years. Technical analysis has helped him filter out the noise and focus on the when-and leave the why to the fundamental analysts. His proprietary trading models have enabled him to identify the NASDAQ top in 2000, the new gold bull market in 2001, the stock market top in 2007, and the US dollar bottom in 2011.

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Disclosure:
1) Statements and opinions expressed are the opinions of Jack Chan and not of Streetwise Reports or its officers. Jack Chan is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation or editing so the author could speak independently about the sector. Jack Chan was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
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All charts courtesy of Jack Chan.

 

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.