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Dollar Breakout Could Be Hard On Gold And Silver

Published 08/15/2017, 11:33 AM

The US dollar so far this year has been very week, losing nearly 10% of its value. This decline might have influenced investors to go long the euro. Below looks at sentiment toward the euro, which we shared 9 days ago.

Euro Sentiment

The chart above reflects that bullish euro sentiment is historically high and in the past when it reached these levels, it was closer to a high than a low.

Below looks at King Dollar’s pattern over the past couple of years.

USD

USD, while testing 2-year support, also finds itself at the apex of a bullish falling wedge, where two weeks ago at (1) a large bullish reversal wick (reversal pattern) formed. This support test is taking place while momentum is oversold and attempting to turn up.

This week, King Dollar is attempting to breakout above resistance of the bullish falling wedge at (3). A rally in the USD and decline in the euro could put downward pressure on gold, silver and the miners.

Due to this pattern, members went long long the USD near the start of this month, with a stop just below the apex of the bullish falling wedge.

Latest comments

Like right
Very good analysis
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