Gold and USD? (2011-03-03 DXY analysis)

Gold price has recorded high, breaking 1,430 level. So I wonder what would happen to the Dollar.



Above is the daily chart of US Dollar Index (.DXY).

I have identified a long-term up-trend line for the index, which was drawn in red. DXY just dropped through this line. We could somehow have bearish view on it, but still have to be aware of false breakdown.

Fibonacci supports the index and provides power to it to bounce back above the line. If we confirm the breakdown, we could expect it to fall to as low as 73.

Breakout of gold price probably leads to retreat of the dollar. So I expect there will be a further surge in other currencies such as EUR and GBP.