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US Dollar and Gold's Inverse Relationship ...
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US Dollar and Gold's Inverse Relationship... and Which way does the US Dollar go from here? ...

 

On the chart below, I show the inverse relationship between the US Dollar and Gold... you'll easily notice the inverse relationship between the US Dollar and Gold during Stages #A thru #J, generally meaning; when the US Dollar drops, Gold rises... when the US Dollar rises, Gold drops... and when the US Dollar consolidates, Gold also consolidates.

The US Dollar and Gold did de-couple from this relationship during Stage #G, when both Gold and the US Dollar moved noticeable higher, however, this stage also happened during the period of Katrina and the resulting higher energy prices and other spin-off risks.

Further, from my analysis, I conclude; when the US Dollar begins the test of it's long-term low support level at approx. 80, that event will trigger the very beginning stages of a new mania in the Precious Metals Sector... however, we could easily see the Dollar bounce up from approx. 80... and then re-test it's lows to find out where the longer-term support for the Dollar really is... IMO, any pro-longed period the US Dollar spends below it's long-time support level at approx. 80, the Precious Metals sector will likely be in a very, very aggressive Bull Market, eclipsing all other previous Precious Metals Bull markets, with Gold likely trading well in excess of $1,000 per oz.

In fact, since just the year 2002, the US Dollar has lost over 30% of its value... and is now only a few percentage points away from testing its low-range long-term support levels.

US Dollar and Gold: Inverse Relationship...

 

Another trend you can notice from the US Dollar/Gold Inverse Relationship Chart is;
The inverse relationship between the US Dollar & Gold is becoming more pronounced, meaning; drop's in the US Dollar are creating proportionately larger increases in the price of Gold as compared to previous years, which can easily be seen when comparing Stage #B to Stages #H & # I... a sign of increasing strength in the Precious Metals Bull market.

 

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