Technical Outlook – US Dollar Index, Gold and Silver

US Dollar Index [I.USDX]

Even after the break of short-term ascending trend-channel, 50-day & 100-day SMA confluence area, between 96.40-30, seems restricting the index decline towards 95.00 horizontal mark; however, a slid below 95.00 could be limited by the 93.30-10 support-zone. Should the index manages to break 93.10, also breaks the 93.00 round figure on a closing basis, it could plunge to 90.00 psychological magnet. Alternatively, a bounce from the current level may cause the index price to test 97.00 – 97.10 area, breaking which 98.50 and the 99.20 are likely intermediate resistances prior to its test of channel resistance and the horizontal mark, between 99.90 – 100.00 that could become important to determine near-term moves. Moreover, a close above 100.00 mark could provide considerable strength to the index that can fuel it towards 61.8% FE of its October 2014 to April 2015 up-move, near 102.00 round figure mark.

GOLD

Failure to break the descending trend-channel support on weekly chart, near $1070-80 area, pulled back the Gold prices towards breaking short-term descending trend-line resistance, signaling march towards $1130 and the $1147-50 horizontal resistances. However, further up-side by the yellow metal seems to be restricted near $1165-70 area, encompassing the 38.2% Fibo of its January-July decline, 100-day SMA and seven month old descending trend-line. On the downside, $1100 mark provides an immediate support to the bullion prices, breaking which the $1070-80 area against comes into play. Should it sustains the downtrend below $1070, the gold prices may plunge to $1000 psychological magnet.

SILVER

Metal’s bounce from $14.50 managed to surpass 50-day SMA and the 23.6% Fibo of its January – July decline, near $15.30; though, $15.70 and the confluence of 100-day SMA together with 38.2% Fibo, near $16.00 mark, may provide strong resistance to restrict the near-term up-move by the Silver prices. However, the metal’s ability to close above $16.00 can fuel it towards $17.00 and the $17.30 important resistances. On the downside, a close below $15.30 can quickly pull the metal prices back towards $14.90 area, prior to test $14.50-40 support-zone, breaking which the $14.00 and the $13.50 are likely consecutive supports that the silver prices may target on its continued downtrend.

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