Correction over?

On Tuesday, April Gold broke out of the brief trading range from last week in the direction we did not expect, back into its blue channel, and rose further on Wednesday to close at $937.80, a new closing high. The tails on Wednesday's candlestick are rather long, indicating uncertainty.

If gold can surmount the resistance here, near the January highs, then a first target might be the top of the channel at around $970. Meanwhile, it remains to be seen whether MACD can complete the bullish crossover it seems poised to make. If it fails, gold could fall back to support at around $900.

March silver also broke back into its blue channel on Tuesday, after again testing support at the purple line, but stayed within last week's trading range. Then on Wednesday silver broke out of that range to close at $17.76, a new closing high for the bull run since August.

While MACD has made a bullish crossover, it remains at a high level, and RSI is about to re-enter the overbought zone. Silver could well rise rapidly to resistance at the green line or the top rail of the channel in the $18.50 to $19 area, but it would do so at the cost of becoming considerably overbought and hence vulnerable to a significant correction.

Should silver fall back out of the channel, it could fall through the purple line as well, before finding support near its 50-day MA, currently at $15.92 and rising.

On Tuesday, GDX gapped up on good volume to close just beneath the upper edge of its symmetrical triangle. Then on Wednesday, the gold-mining ETF broke out on stronger volume and closed at $50.95.

GDX may test the breached downtrend line before continuing what promises to be a decent rally. RSI is back above 50, and MACD has made a bullish crossover. First target is the January high at $54.23.

The U.S. dollar index was unable on Tuesday or Wednesday to close above resistance at 76.2. The index remains trapped within its narrowing symmetrical triangle. RSI is neutral at about 50, and MACD may be gearing up to make a bearish crossover, but a clear indication of the dollar's next major move will come only when it breaks out of the triangle in one direction or the other.