Gold’s Dollar Ratio Breaks Short-Term Support
Chris Kimble | Sep 25, 2017 10:58AM ET
Gold has been weaker than King Dollar most of the time since the 2011 highs. Gold has been stronger than USD since last Christmas.
So which trend is going to be key over the next few months?
Below looks at the gold:USD ratio over the past seven years, highlighting an important price pattern.
The gold:USD ratio has remained inside of the blue shaded channel for the past three years. The rally since last Christmas has the ratio testing the top of this channel and three other resistance lines came into play at (1). Since hitting the top of the channel and triple resistance, the ratio has turned lower — dollar stronger than gold — and broken below steep rising support at (2).
Gold bulls are watching for further weakness at (2) and need the ratio to breakout above quad resistance at (1) to send a strong bullish message.
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