Time to Sell the Dollar and Buy Gold: Charts

Now could be an opportune moment to buy into gold and reduce exposure to the dollar, but investors should watch for key levels first, Daryl Guppy, CEO of Guppy Traders, told CNBC Thursday.

"It's a good time to start thinking about coming back into gold and selling the dollar short again," Guppy said.

His view contrasts to that of famous investor Jim Rogers, who said that the dollar looks attractive because there are so many investors who are bearish on its outlook.

If gold falls below $1,300 per troy ounce, it would signal a downside target of $1,250, he said. A break above $1,355 gives an upside target of $1,450, according to Guppy.

"What we're seeing in the dollar index is a sharp rally is taking place, it's unlikely to be a major change in trend because there're two significant resistance levels," he said.

"What we're likely to see is a fast move toward 79.580 and then a retracement and a retest of that 76.750 level. Now, that will feed through to the gold and we will see that rebound off the underlying trend line in gold," he added.

After a strong push to record highs through most of the past three months, the precious metal's rally has lost some of its luster over recent sessions. The dollar saw a gain during the same period, suggesting the two assets are still strongly correlated.

But Guppy warns against betting on the relationship between gold and the dollar and suggests it might not always be certain.

"We've got a divergence between what's happening with gold and what's happening with the dollar," he said.

Guppy also thinks the FTSE 100 is likely to rally toward 6,500 points.