USD Analysis – Dollar And Gold Approach Key Levels
- The Dow Jones FXCM Dollar Index made an impressive upside move on Thursday, climbing over 1.10% after a broad based “risk off” sentiment prevailed affecting commodities and equity markets.
- The fact that Fed chair Bernanke had brought forward no hint of a plan for QE3, and instead focused on operation twist, has seen the market retreat from the recent dollar selling trend on decreasing QE bets and negative sentiment. A realisation that the market may not be flooded with a huge amount of dollars has USD bulls focusing on the recent highs as a potential near to mid term target.
- The charts below show how the USD had consolidated around key 10,080 area previous resistance and subsequently made a strong brea higher; we see this level as potentially being key over the coming trading sessions as it has proved to be a major price pivot.
- Gold has dropped lower as the USD strength once again prevailed. The $1530 area previous support level has seen significant demand in recent times and a break below would be a constructive technical development.
US Dollar / Gold D1