“It should also be noted that while the U.S. dollar index (DXY, below) remains below its 50-day moving average, it’s still close enough to the 50-day MA that a recovery back above it could quickly be made. Thus it may be necessary for the dollar index to weaken significantly before traders are absolutely convinced that the dollar’s short-term uptrend has been broken. This in turn would argue strongly in favor of a strong short-covering rally for gold….
[T]he U.S. dollar index (DXY) needs to show even more deterioration before gold is ready to commence a major turnaround. In light of the above-mentioned factors, I consider gold’s current outlook to be tenuous and uncertain.”