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If This Resistance Cluster Holds, Gold Could Blast Off

ByChris Kimble
Published 12/11/2016, 12:38 AM
Updated 07/09/2023, 06:31 AM

The chart below looks at the US dollar/Gold Ratio over the past 30-years. When the ratio is heading lower, USD is weaker than Gold/Gold stronger than USD. When the ratio is heading higher, USD is stronger than Gold/Gold weaker than the USD.

At this time, the ratio in the chart below, has created a Power of the Pattern setup, that is seldom if ever seen.

US Dollar/Gold Ratio Weekly 1986-2016

A rare cluster of resistance is in play for the USD/Gold ratio at (1). Resistance is resistance until broken. If this resistance would hold and the ratio would turn lower, Gold could blast off, which would benefit Gold, Silver and Mining stocks.

What do Gold, Silver and Mining bulls NOT want to see happen? If the cluster of resistance is taken out to the upside (USD stronger than Gold), metals could get crushed.

Latest comments

is anybody else getting killed too by usd, gold and yen?
1030
yep
Gold was supposed to rally to 1300+ on a Trump win, there was not going to be a Brexit. I bet there won't even be a Fed rate hike on the 14th, seeing as that is a 100% certainty - just like all the aforementioned. Believe no analysis or economic forecasts, it is all noise designed to trick the retail trader out of money. Gold will rise once we realise there is no Fed rate hike this week. It will jump even further when Trump does not get accession to the white house and there is more political instability. Buy Gold, sell equities. That's my prediction, you can thank me later.
Admittedly Gold has probably found its bottom and once the Fed rate dust settles, we should see some good recovery either way. And then there's the (possible and likely) stock market crash of 2017, so that should also help to boost Gold prices. I have plenty of Gold investment, so let's hope so.
Eh you didn't actually look at the dollar index or gold charts after the rate hikes . Dollar index has fallen significantly after each one since Feb-94 and gold has risen. Look at the charts look at what actually happens . Not quite simply dollar goes up. Index falls every time
There is way too much optimism in the current markets despite slowing growth. The market being at record highs does not seem sustainable. Stocks are expensive right now.
It has the same shape as when it went down before. Graphs are predictive of history (aka they predict nothing). This type of analysis is akin to voodoo...
This article was written last week and now another cloned article? Bla, Bla, Bla... Just face reality... Gold is not going up, anytime soon!!! So please stop fooling your followers!!!
Check the charts lately mate?
Follow the price volume charts before buying and selling gold. Analyst provide their opinion that may not be correct all the time. Two analyst will give two different opinions.
Because gold non rick.
I wish the article showed what the dxy-vs-GDX resistance numbers are..
Sounds as Greek as the Alpha version of the Bible
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