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Main | Dollar Libor Jumps To Fresh 10 Year High, Adding To Funding Headwinds »
Wednesday
Nov282018

Central Bankers, The U.S. Dollar and The Inverse Relationship with Gold

Preamble

There are a myriad of factors that need to be taken into consideration before one can determine the direction of a particular market sector and therefore place a trade. Supply and demand is a popular one when considering the fundamental analysis as are the moving averages when considering technical analysis. Rightly or wrongly we consider the inverse relationship between the US Dollar and Gold to be very important and along with the words and actions of the central bankers.

On Wednesday the 28th November 2018 we saw action in the markets that clearly displayed the relationship of these three factors.

Charts of the USD and Gold

Taking a quick look at the chart of the US Dollar we can see it fell sharply on Jay Powell’s words.

 

The Gold chart shows the inverse reaction to the dollar as it bounced on the dollars demise.

 More.........

 

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