High volatility continued from the last bar, and it appears that the Dow has broken out of its rectangle. We regard this as a signal for aggressive traders. It seems there is some ambiguity here as we will discuss below.
Gold also displays a buy signal with a gap across a high line with a tight downtrend line being broken.
These appear to be valid buy signals. For our readers they should be add-on signals, if that, because readers should be long (or hedged) gold and long the Dow. So there should be no urgency about taking the signals.
If we are somewhat suspicious it is because trends tend to continue, and we don’t see (to our jaundiced eye) totally convincing evidence that the gold downtrend, dollar uptrend is ended. Of course that doesn’t keep us, when in aggressive trading mode from taking the signals and letting the chips fall whereever they fall.
Here is the FXE. As we said we might be jumping on these on some days. The gap and new high are tantalizing. Tomorrow if there is follow through we may be jumping.