Gold/King Dollar ratio breaking short-term support
Gold has been weaker than King Dollar the majority of the time since 2011 highs. Gold has been stronger than King Dollar since Christmas of last year. Which trend is going to be the key trend over the next few months?
Below looks at the Gold/US Dollar ratio over the past seven years and highlights that an important price pattern is taking place-
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The Gold/US$ 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 would get caution/concerning message should further weakness at (2).
Gold bulls want/need the ratio to breakout above quad resistance at (1), to send a quality bullish message.
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