Watch This Indicator For Signs Of A Gold Comeback

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September 17, 2018 6:03am NYSE:GLD

From Chris Kimble: In addition to watching the price of a specific asset, it’s important to monitor other indicators as well. For precious metals and gold bugs, the U.S. Dollar Index and Dollar based ratios can be helpful.


Today, we re-visit the ratio of the U.S. Dollar Index to Gold.  When the Dollar is stronger than the price of Gold, the ratio moves higher… and when the Dollar is weaker than gold it moves lower. Gold bugs and bulls like to see this ratio move lower.

The ratio has been moving in a wide declining channel for 17 years (point A). That said, it’s been rallying higher for the past 7 years, making it hard on the precious metals sector.

But the ratio has recently bumped up against the upper channel resistance, where a bearish reversal may be taking place!  Metals bulls would love to see the 17-year channel resistance hold at (1)… and lead to a move lower.

The SPDR Gold Trust ETF (GLD) rose $0.30 (+0.27%) in premarket trading Monday. Year-to-date, GLD has declined -8.60%, versus a 9.44% rise in the benchmark S&P 500 index during the same period.

GLD currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #1 of 35 ETFs in the Precious Metals ETFs category.


This article is brought to you courtesy of Kimble Charting Solutions.


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