Technical analysis of Gold for July 26, 2016

The Dollar index remains in a bullish short-term trend with higher highs and higher lows and could soon confirm the breakout above 96.70 by breaking above 97.70 and confirming the bullish trend towards new highs.

Blue lines - bullish short-term channel

Red lines - long-term trading range

The Dollar index is trading inside the bullish blue channel making higher highs and higher lows above the 4-hour Kumo(cloud). As I mentioned last week, for the breakout above 96.70 to be confirmed, we should see a re-test and a follow-through upside move. This is exactly what is happening, and the Dollar confirms the breakout. Our next target is 97.70. If broken, we should expect more power to the upside.

The weekly candle is testing the upper cloud boundary at 97.50-97.70. The trend is bullish. There is no divergence signal from the oscillators. The price is making higher highs and higher lows. A weekly close above the Kumo will be a very bullish signal for the index. Weekly critical support is now at 96.50.The material has been provided by InstaForex Company - www.instaforex.com