Usually when the dollar goes higher, gold goes lower. Not today
The dollar has raced higher and is now the strongest of the major currencies today.
Despite the rise in the greenback, gold – which typically falls with a rising dollar – is higher by about $3.00.
Technically, the precious metal moved above the 100 hour MA (blue line) earlier in the day and has stayed above that MA since then. Maybe buyers are just leaning with stops below,and not really paying attention to the dollars move?
When you correlate one instrument to another, it is hard to explain what happens when what you expect to happen, doesn’t happen. Moreover, you don’t really know if it is an aberration with gold being wrong, or the dollar being wrong.
If you answer by saying “I think the dollar is wrong” or “I think gold is wrong”, you are making a judgement of “the Market”.
Alternatively, if you want to trade gold to the upside because you think the dollar rise is bogus, use the 100 hour MA of gold to define and limit risk. Stay above is more bullish. Move below is more bearish. If you are right that the dollar is wrong, it sells off and gold rallies tomorrow, you win. If you are wrong and it is gold that needs to catch up to the runaway dollar, you protect yourself at the MA line.