With the DXY taking a massive hit on Friday, time to take a look at the unloved yellow metal.
As I have noted in an earlier piece, the BEST indicator for Gold that I can see, (leave a comment if you think of a better one) is the inverted DXY chart, surprise, surprise, a weak dollar correlates with a rising Gold price.
Daily:
The correlation, aside from a minor divergence (highlighted) is quite apparent, with the latest selloff in the DXY being met with a nice double bottom pattern in Gold (as noted in my most recent article concerning Gold (my debit spread is doing quite nicely).
4h:
Moving down to a 4h chart and the correlation is undeniable.
DXY Monthly:
Switching over to the DXY and the latest "rally" in the dollar may very well be the last kiss goodbye from the previous trend break, with further downside in the DXY likely to be on the cards, the timing for a move higher on the yellow metal seems to be quite good.
-TradingEdge
As I have noted in an earlier piece, the BEST indicator for Gold that I can see, (leave a comment if you think of a better one) is the inverted DXY chart, surprise, surprise, a weak dollar correlates with a rising Gold price.
Daily:
The correlation, aside from a minor divergence (highlighted) is quite apparent, with the latest selloff in the DXY being met with a nice double bottom pattern in Gold (as noted in my most recent article concerning Gold (my debit spread is doing quite nicely).
4h:
Moving down to a 4h chart and the correlation is undeniable.
DXY Monthly:
Switching over to the DXY and the latest "rally" in the dollar may very well be the last kiss goodbye from the previous trend break, with further downside in the DXY likely to be on the cards, the timing for a move higher on the yellow metal seems to be quite good.
-TradingEdge
