As mentioned in our last article, gold in USD needs to break its short term downtrend line in order to send a potential trend reversal warning, but so far no signs of a major shift. The downtrend line holds well and price keeps sliding without any attempts to break it.
The last major support, 68.2% fibonacci retracement (1) has been broken easily giving more room for a continuation of the current downtrend unless this trend line is tested and broken with a daily close above it. (2)
The egoldfx TrendStrength Meter confirms this trend even if on 03/03/2017 we had a trend reversal warning with USD strength line crossing only briefly the gold strength line (1) but the very next day the USD managed to regain some strength signaling that the downtrend was not going to give up that easily.
Currently, USD strength line is above the 7 level bounce line while the gold strength line is sinking into a weak area below the 3 level bounce line. This configuration tells us that we should have soon a short term trend reversal warning when those two lines will cross. Next week, unless a major unexpected event or news comes and with the large gap between the two strength lines, we shouldn't expect a major shift in the short term gold/usd market.
