What To Watch
Spring (Reversal) Position
Not every bullish set-up works.
However with the dollar, continuing sentiment is so negative along with bonds, the dollar has potential to do the unexpected; that is, go higher.
Yesterday, UUP pushed below support (and 23.6% retrace) levels.
In so doing, price action’s now in ‘spring’ (reversal) position.
Pre-market action shows UUP, trading higher; right at support that may now be resistance … maybe.
That’s where to watch.
The currently held belief is dollar collapse and gold to $3,000/oz.
Dollar (UUP) Analysis:
The daily chart of UUP may be painting a different scenario:
The dollar’s already in an up-trend. It just established support at the 23.6%, Fibonacci level. There was a bounce higher and then yesterday, penetration below support.
Now, in the pre-market, UUP is currently trading at 25.14 – 25.16, which is at or even above the support level.
A dollar reversal higher at this point, being a very shallow 23.6% retrace thus far, would potentially spell big trouble for gold and the miners.
Of course, no one ‘expects’ this to happen.
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The Danger Point®, trade mark: No. 6,505,279