September 8 Morning Market Update

Again, we continue to be surprised by the dollar's weakness. It could not rally strongly enough to force gold down even though gold was overbought. With the dollar breaking down below support in the wedge at 78, then immediately below the key support of 77.43, and conversely gold rising above 1000, we believe this will stick.

The lack of "fight" in the dollar, even though it is oversold, is concerning for dollar holders.

The key USDX support of 76 is the level at which the dollar is likely to rally enough to work off its oversold condition. We may see a touch of 76 and a retest of the 77.43 level. That would be a buying opportunity for most assets, including gold, which may retest these levels again. There's very little support for the dollar between 76 and 72, so after a bounce off of those levels, that may be it for a while.

We'll update more charts this evening.