From Chris Kimble: The currency markets often play a role in asset management for investors. And one key asset that pays close attention to the US Dollar is Gold (and precious metals).
Could a near-term trend change be in store for the US Dollar… and its counterpart, the Euro? Precious metals bulls would love to see the US Dollar topping and the Euro bottoming.
In the chart below, you can see that the two currencies are showing similar reversal patterns – a traditional head and shoulders top for the US Dollar Index and an inverted head and shoulders bottom for the Euro.
BUT, they need to confirm these pattern by breaking down / up.
It’s worth noting that NOTHING has been proved so far, but the potential of both creating longer-term reversal patterns is there and traders should stay tuned.
US Dollar vs Euro Currency Chart – Reversal Patterns?
The Invesco DB US Dollar Bullish (UUP) was unchanged in premarket trading Friday. Year-to-date, UUP has gained 3.66%, versus a 10.45% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Kimble Charting Solutions.