Dollar meets resistance

The U.S. dollar index reached up to kiss the long-term trend line at 77.8 on Monday, fulfilling the projection of the inverse head and shoulders, before falling back to close nearly unchanged at 77.41. RSI is flattening out at overbought levels similar to those in mid-August that preceded the recent decline. Although MACD is still rising, its histogram is also relatively overbought.

After a few more attempts to continue its rally, the dollar is likely to be rebuffed by the trend line and resume its decline. Should it, however, succeed in breaking through, the index could rise to its 200-day MA, which is currently slightly above strong resistance at around 80.

Gold fell briefly below support at its 50-day MA on Monday but rebounded to close up $1.30 at $799.30, just under $800 -- which has been exerting a magnetic attraction on the yellow metal since the beginning of the month. While RSI is flattening out just below 50, MACD continues its decline.

Gold now lies within the lower boundary of what appears to be a pennant, which usually resolves in a continuation of the prior trend. Should support here fail, gold could test decent support at the Fibonacci 38.2% retracement level, around $773. Stronger support lies below that at around $750, the Fibonacci 50% retracement level.

Silver dipped as low as $13.74 on Monday but recovered to close unchanged at $13.98, well within the $14 support zone, which has held since the beginning of November. RSI is flattening out, but MACD continues to decline.

Should support here fail, silver could find a springboard at its 200-day MA, currently at $13.43.

GDX fell nearly 4% on Monday to close at $42.55, its lowest level in three months. RSI is falling toward 30, and MACD is declining rapidly.

The gold-mining ETF looks set to test support at its 200-day MA, currently at $41.84.