Investors
and traders in the gold complex are running out of patience in reaction to the
slump in the sector following an early summer rally. Nothing is working be it
seasonal, Russia
or the so-called extended global equity markets.
I
think our dollar/gold chart pinpoints the real problem – the strong U.S. dollar
which has been the go-to place – well since early summer. As we can see the
price relationship is somewhat inverse – dollar up – gold down and vice-versa
as displayed by the lower US$ vs. gold study. The big disappointment for gold
investors was due to the early summer advance in spite of the dollar advance –
this appeared to be a set-up for a dollar peak which did not occur. Let us see
if the US Dollar index trades back up to the 84 level – or the $23 level on the
UUP – and then look for the gold complex to rally.
No comments:
Post a Comment