Gold Bottoming In Most Currencies

Here is a chart of GLD versus PowerShares DB U.S. Dollar Index Bearish Fund (UDN). This shows the price of gold relative to the foreign currency basket that is the U.S. Dollar Index (Euro 57.6%; Japanese Yen 13.6%; British Pound 11.9%; Canadian$ 9.1%; Swedish Krona 4.2%; Swiss Franc 3.6%). Notice that the 50-day moving average is still above the 150-day.

Here is GLD alone. The 50-day moving average has cross the 150-day moving average, but the bounce is more pronounced due to recent USD weakness relative to the euro and yen.

Here is GLD against CEW, an emerging market currency basket.

Finally, GLD versus the Australian dollar (FXA), which has been very weak since May. Notice that gold has actually flat-lined since May in the Australian dollar. Good news for Aussie miners?

Gold also appears to be topping versus the miners. Here is GDXJ, which formed a head-and-shoulders pattern in the 14-day RSI. This isn't necessarily bullish for miners, only that they will outperform the next move in gold, up or down.

Since I expect a U.S. dollar rally, the gold price may be under pressure moving forward, but I expect it will not breakdown again in currencies such as the Australian dollar.

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