As noted in NFTRH 743, USD (DXY) finally took the hint from the Gold/Silver ratio (GSR) and bounced. Let’s look at the leader first.
GSR is testing the underside of its 200 day moving average. A breakthrough here would indicate potential for more near-term pain across the global macro, including the precious metals and gold stock sector. It would also obviously be a tailwind positive divergence for USD. A failure would help us resume a positive narrative on the Q4-Q1 relief rally.
As to USD, it has retraced 23% of its decline from September and is poking through the 50 day moving average. That is enough to halt a bounce, but I think a better objective is where the 200 day average meets the 38% Fib retrace level up around 106, as also noted in #743.
Just an FYI snapshot of two asset market antagonists for your consideration.
