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Euro Weakness Here Could Spell Trouble For Gold And Silver Bulls

By Chris KimbleCommoditiesOct 13, 2020 12:01PM ET
www.investing.com/analysis/euro-weakness-here-could-spell-trouble-for-gold-and-silver-bulls-200540884
Euro Weakness Here Could Spell Trouble For Gold And Silver Bulls
By Chris Kimble   |  Oct 13, 2020 12:01PM ET
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Euro Index Monthly Chart.
Euro Index Monthly Chart.

The euro is facing one of the most important price tests in the past 20 years. What it does here, should have a large influence on the price of gold and silver weeks from now.

This chart looks at the euro on a monthly basis, since the late 1990s. Line (1), which is the 1.20 level, has come into play numerous times as both support and resistance.

Since 2008, the euro has been consistent about creating a series of lower highs and lower lows.

The euro created a triple bottom from 2015 to 2016. Metals have done very well, once the euro created a triple bottom from 2015 to 2016.

The rally from the 2020 lows, has the euro testing line (1) and the falling channel at (2). Last month, the euro looks to have created a bearish reversal pattern, just under resistance.

Should the euro turn weak and break support at (3), after kissing the underside of 20-year resistance at (2), odds favor that metals will struggle to move higher.

Gold and silver bulls should pay unusually high attention to what the euro does in the next couple of months. For sure weakness at (3) would be negative for metals.

Do keep this in mind, should the euro accomplish a dual breakout at (2), it would send a rare and long-awaited bullish message to gold  and silver.

Euro Weakness Here Could Spell Trouble For Gold And Silver Bulls
 

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Euro Weakness Here Could Spell Trouble For Gold And Silver Bulls

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Comments (3)
Ali Rate
Ali Rate Oct 13, 2020 2:32PM ET
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God bless you
Victor Yakov
Victor Yakov Oct 13, 2020 1:56PM ET
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How is euro linked to gold and silver on fundamental level?
Alex Rivera Rodriguez
Alex Rivera Rodriguez Oct 13, 2020 1:56PM ET
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As Us Dollar gets bullish, euro goes bearish, therefore gold and silver also goes bearish due to dollar appreciation.
la popeye
la popeye Oct 13, 2020 1:56PM ET
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or central bank are selling gold and euro in order to pop up the dollars in distress value as a safe haven
David Bud
David Bud Oct 13, 2020 1:56PM ET
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lol the dollar bullish. fat chance of that going forward, if anything the dollar will tumble more.
Pan Glos
Pan Glos Oct 13, 2020 12:04PM ET
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And crypto?
 
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