An update of the 2 riders opposing a would-be renewed inflationary reflation trade. To review, the Gold/Silver ratio is an indicator of failing market liquidity when it rises and the USD is the receiver of bids seeking liquidity amid market stress.
USD (DXY) is testing support and is a hair below the breakout point of the would-be bullish inverted H&S bottoming pattern (not shown in its entirety here). Recall that step 1 was to take the neckline and step 2 was to clear the March high and the red shaded resistance zone. There is no conclusive break one way or the other yet.
However, the Gold/Silver ratio is making a positive move from above the SMA 200 and if that continues and follows through, it would be a positive for the US dollar and a negative for risk ‘on’ markets as the implication would be a rush to the liquidity of the global reserve currency.