Gold, Silver and the USDX: The Key April Analogies and Key Elements…

The USDX began this week with a decline, and whereas this might sound discouraging, I want to level out three crucial info:

1. This decline took the USDX to the 61.eight% Fibonacci retracement primarily based on the 2008 – 2022 rally, which gives VERY sturdy assist. It was solely considerably beneath the identical retracement however primarily based on the 2020 – 2022 rally.

2. The breakdown beneath the 2020-2022 61.eight% Fibonacci retracement was not confirmed.

three. The USD Index simply reached its declining resistance line primarily based on the 2022 and 2023 highs.

All three are very sturdy causes for the USD Index to show again up, and the truth that now we have them collectively is really distinctive (particularly that the weekly RSI is now extraordinarily undervalued).

This creates a really bullish outlook for the USD Index, which poses a big hazard to anybody being lengthy valuable metals right here (from the buying and selling perspective).

Gold may stay risky (sentiment continues to be red-hot, individuals’s searches for gold and silver ira funding close to me are nonetheless booming), however given silver’s reluctance to maneuver to new highs right here, evidently the white steel is especially susceptible to a sell-off.

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Przemyslaw Ok. Radomski, CFA
Founder, Editor-in-chief