John Murphy in his classic on "Intermarket Analysis" writes on the dollar gold negative correlation.
Here we compared DXY - Gold correlation on daily chart in regard towards 200 day average.
If you will take closer look, you will see that in case of divergences forming, it is dollar index that usually fails.
If gold breaks resistance (being in sharp uptrend towards 2011 highs) and we do observe some sort of bullish cup and handle continuation pattern - dollar is likely to fall.
By DeMark criteria, bullish breakout on gold looks better than the one on dollar index.
On correlation cofficient, we are also observing ever decreasing divergence trend towards 200 day average.
At any case one of two should fail in uptrend:)
Here we compared DXY - Gold correlation on daily chart in regard towards 200 day average.
If you will take closer look, you will see that in case of divergences forming, it is dollar index that usually fails.
If gold breaks resistance (being in sharp uptrend towards 2011 highs) and we do observe some sort of bullish cup and handle continuation pattern - dollar is likely to fall.
By DeMark criteria, bullish breakout on gold looks better than the one on dollar index.
On correlation cofficient, we are also observing ever decreasing divergence trend towards 200 day average.
At any case one of two should fail in uptrend:)
הערה:
הערה:
GOLD DOLLAR CORRELATION IS NOT A TRADING STRATEGY. DIVERGENCES MIGHT LAST FOR YEARS.