Gold Up, Dollar Down

The short position in JDST was exited during yesterday’s session with a decisive ding to one of the trading accounts.

Obviously, something was not analyzed correctly.

Pulling out to a larger view and looking at the correlated markets; bonds, the dollar and gold, it appears that bonds are moving higher first. 

It was probably a head-fake to think the dollar will move exactly in tandem.  That was the error plain as day, now.

The second error was not to see the first error. Enough said.

In fact, after yesterday’s session we see the dollar might be in the process of testing its trading range lows.

The dollar and the mining indexes, at this point are inversely correlated. 

The dollar was down sharply. The miners were up in an opposite move.

The dollar (UUP) chart below shows a potential forecast.  If UUP pushes lower from this point, it sets up a reversal condition (penetrating minor support) before it contacts major support.

Correspondingly, the miners and gold would be moving higher … for now.

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.
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