After a harrowing week for gold, gold prices still sit right at the edge of correction territory.
Strong tech stock earnings early in the week were then followed by positive U.S.–EU tariff news and strong economic numbers.
All of this pushed and pulled on the dollar, which moved the price of gold right alongside it.
That kept the metal in a range between $1,218 and $1,233 as the bulls and bears fought it out.
There are several reasons the dollar may be done rising for awhile, and that should help gold.
But a contrarian signal from the futures market may be even more telling – and could cause gold to explode higher in the weeks and months ahead.
Let's look at recent gold price action and then delve into this a bit further…
Why Last Week Could Be a Turning Point for Gold Prices
Gold started out on a high note last week, opening on Monday (July 23) at $1,231, then falling until early Tuesday (July 24) morning as the U.S. Dollar Index (DXY) peaked at 94.8.
Gold followed riskier assets a bit higher on Tuesday, with stocks popping after good earnings from Alphabet Inc. (Nasdaq: GOOGL), while the dollar index backed down to 94.45 before closing near 94.60.
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On Wednesday (July 25), news emerged that the European Union was preparing $20 billion in tariffs, denting the dollar and sending the DXY to 94.2 by the close.
But stocks also rallied on the announcement that the United States and EU would work together toward zero tariffs. This helped gold rally back by $8 and close at $1,232.
Here's the DXY action of the past week…
Those gold gains evaporated on Thursday (July 26) as the markets shot higher on looser risk appetites.
Early on Friday (July 27) morning before strong GDP growth numbers came in at a healthy 4.1%, gold dipped to $1,218.
But consensus was slightly higher at 4.2%, so the dollar index retreated to 94.65, allowing gold to return to the $1,223 level.
I think this might finally be the end of the DXY's pull on gold prices, and the indicator I'm following is making my latest gold price forecast especially bullish…
What This Indicator Means for My Gold Price Prediction
About the Author
Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it's in gold, silver, oil, coal, or even potash.