In Monday's blog I wrote that the U.S. Dollar Index:
"...is now at a support level centered just above 89. This week's reversal zone is targeted at currencies so we could see a bounce from this support this week or next. Such a bounce could push down gold and silver prices, but this would likely be very short-term."
The dollar has rallied sharply from Monday's low as gold and silver prices fall, but the greenback is now encountering (again) that heavy resistance zone from 90 -91. It would take a lot of bullish momentum to push through that resistance, and current directional momentum in the U. S. dollar chart is almost 100% bearish. This supports the idea that this rally will not get far and could turn down again soon. If silver makes a new weekly low this week or early next week with gold staying above $1304, that would also be a bullish sign (bullish divergence) and would further support our bullish view of these metals. Holding my long position in gold and out of silver for now.
Crude oil has been falling from its Monday high of $66.55 (May contract chart). I believe crude is taking its cues from the broad stock market right now. If equity markets stabilize around their Feb. 9 lows and rally again, I think crude could push to new highs near $69; however, if the DOW, S&P 500 and NASDAQ all break below their Feb. 9 lows then crude's cycle high may be in (at Monday's $66.55), and prices could be headed lower to the end of the medium-term cycle which would be anytime within the next seven weeks. Let's stay on the sidelines of crude for now.