So far today, we have a mixed bag of technicals on the precious metals (gold & silver) and major forex pair (US Dollar & Euro). /DX ($USD) is backtesting the trendline after breaking out above it & then reversing off the 97.060 resistance level. As such, should the $USD make a successful backtest & start to rally soon, a solid break above the 97.060 would trigger a buy signal & likely open the door for a rally up to & quite likely beyond the next target of 97.595. However, a solid break back down below the trendline would result in a false/failed breakout with /DX likely continuing lower to extend the positive divergences that were in place at the previous low. 60-minute chart below.
DX 60m June 9th
One of the things giving me pause on the breakdown in /DX is the fact that /E7 (Euro) broke down below the primary uptrend line on the 60-minute chart last night followed by a sharp reversal so far today which has currently taken it back above the trendline. Unless the Euro reverses soon & moves back down below the trendline, that will have resulted in a whipsaw signal (i.e.- false breakdown) which is a sign of non-confirmation on the breakout in /DX.
E7 60m June 9th
Not only are there a mixed bag of technicals on the major currencies but also one the precious metals as well. Following the recent breakdown below the 60-minute uptrend line, /SI (silver) continues to backtest it from below, keeping it in a bearish technical posture for now.
SI 60m June 9th
However, /GC (gold) has made a solid recovery of the key 1700 level following the recent breakdown/whipsaw below, as the bullish divergences that were highlighted at that time have since played out for a rally. With gold back inside the 2+ month sideways trading range, the near-term outlook once again becomes unclear.
GC 60m June 9th
One thing worth noting, in addition to the recent rally in gold, US Treasury bonds (/ZB, TLT, etc.) also continue to build on the recent gains today with TLT up a relatively large 1.8% so far today. This shows a continued, albeit fairly recent, trend of money flows into the risk-off assets (gold & Treasury bonds) in recent sessions. With SPY currently down 1.16% on the day, we could be looking at the early stages of money rotating out of stocks & into the risk-off assets so I will continue to monitor the price action & nearby support levels on the major indexes, sectors, & market-leading stocks.