Wednesday, 14 December 2011

Gold approaches key trend line

Gold looks set to test the nearby trend line, one of a sequence of parallel trend lines that has tracked gold's "stair stepping" upwards progress for the past decade.

The second chart shows that the nearby trend line is doubly significant, as it touches multiple highs from the late 1980s.

US dollar index breaks upwards from cup and handle pattern

The US dollar index has broken upwards from a cup and handle pattern, with a measured target in the mid 80s. The measured target is derived by adding the height of the cup to the breakout level. This chart shows trade through to the New York close on December 13 (approximately 11 hours ago).

The EUR/USD accounts for 59% of the US dollar index, so not surprisingly it has broken downwards from an inverse cup and handle pattern, with a measured target of 1.22.