Gold rally expected to falter as Dollar strengthens

China’s Yuan continues to weaken while the Dollar index strengthens. Follow-through above 97 would signal another primary advance.

Dollar Index

A strengthening Dollar would weaken demand for Gold. The bear rally is likely to meet stubborn resistance at $1250. Reversal below support at $1180 would warn of a decline to the 2015 low at $1050/ounce.

Spot Gold in USD

The monthly chart of Spot Silver also shows a strong down-trend, testing primary support at $13.50/ounce.

Spot Silver

Crude oil is also showing signs of weakness, with a bearish divergence on the Trend Index. Breach of support at $65/barrel would warn of a primary down-trend.

Nymex Light Crude

In the long-term, gold and oil tend to rise and fall together.