2023-06-13 14:28:00
When the US is strong, it is a headwind for the precious metals. And when the US dollar is weak, it is a windfall for the precious metals.
Today we will review this relationship between precious metals and the dollar by taking a look at the “weekly” chart of the US dollar vs Investment fund in mining companies (GDX)، and gold investment fund (GLD). We explain why we believe this relationship has reached a critical inflection point.
Looking at the chart, we can see that the King Dollar has been making lower tops over the past 9 months and might be in the process of forming a new lower top as it tests the 23% Fibonacci level at the point (1).
Looking at the correlation, continued weakness in the US dollar is great for gold, gold mining companies, and precious metals in general. You can see the uptrends in the boxes GLD And GDX In periods when the dollar trend has become bearish.
It seems that the weakness of the US dollar at point (1) will be good news for gold investment funds and investment funds in gold mining companies GLD And GDX ... While the recovery of the dollar will be bad news. It seems that this relationship is going through an important period. Stay tuned!
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