Moves up by 1.7%
Spot gold has moved higher in reaction to the lower USD today. Generally speaking, the relationship between the two is an inverse relationship - although it is not always the case.
Technically, the price moved above the 100 and 200 hour MAs on December 27th. That was the first significant break above the 200 hour MA since the US election back in early November. The testing and the holding of the MA was a key clue for bullish move back on Dec 27 and again on Dec 29th.
On Tuesday the price dipped back below that 100 hour MA but when the price moved back above, the buyers became more hungry. Today - looking at the hourly chart - the yellow metal has stalled near a topside trend line near 1183.50. That trend line will be eyed by both bulls (buyers) and those looking to sell (bears). A risk defining level for both in trading today.
That is the bullish view.
The bearish view comes from the daily chart below.
Spot gold has given up most of the gains saw in the 1st half of 2016 and in the process moved below the 50% and 61.8% of the move up from the end of 2015 low. The price today retook the 61.8% level at 1172.11 but remains below the 50% at 1210.94. The price is also stall below the 50 day MA at 1193.46 (see chart below).
So although, there a bullish look from the hourly, the move higher is likely just corrective with upside resistance likely to get in the way.
