Gold Versus Dollar

 

Gold Versus the DXY

Similar to 2005 when both instruments rallied together.

Re-monetization of gold in effect while risk aversion theme drive.

Gold is not just in a long-term uptrend in USD terms.

Recent breakouts have been registered in USD, EUR, CHF and CAD terms.

Monetization theme: gold is trading like a “currency”.

Investors turning to physical assets in times of elevated uncertainty and risk aversion.

 

The US currency is fiat currency traded on foreign market and are used as reserve currency . The price of gold is related to the value of U.S dollar . The value of gold remains stable in comparison to currencies but its price in any given currency can fluctuate as the value of currency changes.

 

I prefer gold rather than USD

 

Gold is quite stable

 

The gold market just like the forex market involves traders' anticipating market movement too, just that the gold is a better way to diversifying risk. Gold has a spectacular relationship with the American dollar and crude oil prices too. Gold trading is comparable to hedge security; India is the largest consumer in volume terms, making up for 27% of demand in 2009, after this is China and the USA.