Ready to break (2011-11-25 Gold analysis)

Thanks to Angela Merkel's comment about not having Euro-bond, Euro plunged and that US Dollar Index rose. As pointed out yesterday, it should go up to around 80 before meeting a huge resistant, and the index is currently 79.12, so it might still be able to go up a bit.

Daily chart of Gold (XAU=):















Looks like it would be going to break either side. However, as shown on the chart, downside is pretty limited given the other dotted green line below the solid green line.

So the price is currently supported by the solid green line. If it breaks, then the next support level will be at around 1650, which is very strong.

If the price even breaks below 1650, I will have an extremely bearish view on it because that green dotted line represents a quite-long term bullish trend. Reversal of this trend means a hard slump.

On the other hand, the next resistant is at around 1755, provided by the red down-trend line. If this level breaks, I think it would go up to the previous high at around 1900.

These are the levels we have to be a