What Would The USD Death Cross Mean for Gold?

Death Cross on the USD Index? Is it going to happen? What's likely to happen next, and what are the implications for gold?

Gold reversed once again yesterday, as there were no specific indications from Powell during his speech. Please take a look at the chart for details:

So far, gold is higher in today’s pre-market trading (and silver once again moved close to $24 - nothing new here), and it could be the case that we see yet another reversal today.

It might seem that nothing interesting is happening on the markets at this very moment, but… There were two things that we were asked to comment on recently. One of those things is gold and the USD Index, and the other thing is the (probably) approaching “death cross” in the USD Index.

The death cross is formed when the 50-day moving average moves below the 200-day moving average, and it seems that we’re about to see something like that in the USDX. What are the implications for the USDX? And what are they for gold? Interestingly, they are not mirror images of each other. I prepared a video in which I go over the details. I’m also attaching the chart that I covered during the video.

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Przemyslaw K. Radomski, CFA
Founder, Editor-in-chief