Spot Gold broke medium-term support at $1700 to signal another correction, with an initial target of $1600. Breach of this level and the rising trendline would warn that the long-term up-trend is slowing. Reversal of 63-day Twiggs Momentum below zero would also suggest a primary down-trend.
Introduction of repos or short-term deposits by the Fed, to offset the effects of long-term bond purchases, would dampen inflation expectations and reduce the allure of gold for investors. It would also strengthen demand for the dollar.
Breakout of the Dollar Index above 80.00 would signal an advance to 82.00 and confirm the primary up-trend. The long-term target remains at 85.00*.
* Target calculation: 80 + ( 80 – 75 ) = 85
Your analysis really renders a reliable second opinion for investing in currencies & gold