The precious metal is running higher on the back of a weaker US dollar and is testing a former area of support turned resistance. Gold will need to make a confirmed break of $1,730/oz. Though if the backdrop for the precious metal is to turn bullish.
The US dollar is sitting on a zone of support held for the last month and is consequently making a double-bottom pattern in the process. This technical pattern typically suggests a price reversal, from bearish to bullish, but a break of the neckline – currently around 113.85 – is needed to confirm this set-up. However, a break and open below this area leaves the US dollar likely to re-test a prior swing high and a cluster of previous lows around the 109.30 level.