Dollar rallies while Gold & Silver fall

By Colin Twiggs
May 17th, 2012 1:00 a.m. ET (5:00 p:m AET)

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The Dollar Index is testing primary resistance at 81.50 on the weekly chart. Respect of zero by the latest 63-day Twiggs Momentum trough suggests continuation of the primary up-trend. Follow-through above 82 would signal an advance to 86*.

Dollar Index

* Target calculation: 82 + ( 82 - 78 ) = 86

Spot Gold broke support at $1550/ounce on the daily chart. Expect retracement to test the new resistance level at $1600 but a sharp fall below zero by 63-day Twiggs Momentum warns of a primary down-trend. Breach of support at $1500 would confirm, offering a long-term target of $1200*.

Spot Gold

* Target calculation: 1500 - ( 1800 - 1500 ) = 1200

Spot Silver is testing primary support at $26/ounce. 63-Day Twiggs Momentum oscillating below zero already indicates a primary down-trend. Breach of support would offer a target of $16/ounce*.

Spot Silver

* Target calculation: 26 - ( 36 - 26 ) = 16

Adversity makes men, and prosperity makes monsters.

~ Victor Hugo