The Fed has signaled a “patient approach” to raising interest rates, causing long-term yields to fall. Ten-year Treasury Note yields broke primary support at 2.00%, signaling another test of the 2012 low at 1.40%. Declining 13-week Twiggs Momentum below zero confirms continuation of the down-trend. Recovery above 2.00% is unlikely, but would warn that the down-trend of the last 12 months is ending.
The Dollar Index is headed for a test of long-term resistance at 100. Rising 13-week Twiggs Momentum signals a strong (primary) up-trend. Retracement to test support at 90 remains a possibility, but the likelihood of reversal below this level is remote.
* Target calculation: 90 + ( 90 – 80 ) = 100
Gold
Despite the rising Dollar, Gold continues to test resistance at $1300/ounce. Breakout would signal a rally to $1400/ounce, but trend reversal is unlikely. Retreat below $1200 would confirm a long-term target of $1000*.
* Target calculation: 1200 – ( 1400 – 1200 ) = 1000
The Gold Bugs Index, representing un-hedged gold stocks, displays a similar picture. Breakout above 200 would signal a rally to test the declining trendline around 250, but reversal of the primary down-trend is unlikely.
You might want to take a look at the XGD Oz index different story despite being dominated by NCM.
There is an additional factor affecting the price of NCM and XGD, and that is the AUDUSD exchange rate.
Neat and very apt logical response. Thanks
Precisely. Gold is at yearly highs in quite few currencies a s a consequence of the USD strength. Which is stronger ? the USD or Gold.
Time will tell but I suspect gold.