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Bullish Dollar is Good for Gold

Figure 1 shows a weekly chart of gold (cash data). The price bars marked in red are those times when our Dollar model (see this article) suggests an upward trend in the greenback.

Figure 1. Gold/ weekly
Gold weekly

Over the last 10 years, gold bottoms when the Dollar Index embarks on an uptrend. Despite what most investors believe, Dollar strength is good for gold.

 

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