The Dollar and Gold: Mirror Images

I noticed that the gold and dollar charts are almost a perfect mirror image of one another in any time frame. I measured the angle of ascent of gold and the angle of descent of the dollar on the hourly charts and they are 30° and 330° respectively. Pretty neat! The falling dollar is inflationary because we have to pay more for imported goods, and gold is seen as a classic hedge for inflation.

You can see that the inverse relation generally holds true in the bigger picture too. Dollar/Gold is one of the classic intermarket relationships; you could almost trade the dollar off a gold chart or gold off a dollar chart and not get into trouble as long as you remembered that short is long and long is short. ;-)

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