Gold Finds Support
By Colin Twiggs
March 18, 2010 1:00 a.m. ET (4:00 p:m AET)
The US Dollar Index broke through support at 80 and the rising trendline — warning that the up-trend is weakening. Declining Twiggs Momentum (21-day) reinforces the signal. Recovery above 81.4 is unlikely, but would signal another primary advance.
Gold found support at $1100 while Twiggs Momentum (21-day) respected the zero line at [R], signaling buying pressure. Recovery above $1140 would indicate an advance to the January high of $1220*. Reversal below $1100 is less likely, but would test primary support at $1060.
* Target calculation: 1140 + ( 1140 - 1060 ) = 1220
Crude is headed for a test of the upper border of the large broadening wedge consolidation. Breakout or a failed swing would indicate future direction. On the Momentum chart, a large trough that respects the zero line would signal a primary advance.
The Dow Jones Industrial Average is testing resistance at the January high of 10750. Breakout would signal an advance to 11500*. Twiggs Money Flow (21 day) holding above zero indicates buying pressure.
* Target calculation: 10750 + ( 10750 - 10000 ) = 11500
The euro is testing resistance at $1.38 as Momentum rises, having penetrated the declining trendline. Breakout would offer a target of $1.42*. Reversal below short-term support at $1.345, however, would signal a decline to $1.30*. In the longer term, a higher (large) trough on Twiggs Momentum (21-day) would indicate a trend change.
* Target calculations: 1.38 + ( 1.38 - 1.34 ) = 1.42 and 1.34 - ( 1.38 - 1.34 ) = 1.30
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The greenback is strengthening against the yen. Breakout above ¥ 92 would signal the end of the correction — and an advance to ¥ 97*. Reversal below ¥ 88.5, however, would test primary support at ¥ 85.
* Target calculation: 93 + ( 93 - 89 ) = 97
The Aussie dollar is headed for a test of $0.93; breakout would signal a test of parity. A large trough above zero on Twiggs Momentum Oscillator (21-day) would confirm the advance. Reversal below $0.91 is unlikely, but would warn of another down-swing.
Nature gives to every time and season some beauties of its own; and from morning to night, as from the cradle to the grave, it is but a succession of changes so gentle and easy that we can scarcely mark their progress.
~ Charles Dickens