A snap shot of the dollar over the last few days, going sideways and trying to consolidate. This action, along with a number of pundits calling for dollar rally has helped to put a cap on gold prices.

The chart below takes a longer view of the dollar and is overlaid with golds progress. It clearly demonstrates the inverse relationship that exits between the dollar and gold. Gold and indirectly silver are reflecting the dollars behaviour so we need look no further for now.

However the time will come when gold will be recognized by many more investors and will rise regardless of the dollars progress. When this becomes apparent the general public will begin to take a keen interest and that will signal the beginning of the mania period whereby both gold and silver head north in leaps and bounds. At this point even the dogs with fleas in this sector will experience unheard of price rises as the masses buy anything that resembles the real thing.

However, quality always shines through and those who hold the quality stocks will do the best.

Have a good one.

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