The currency markets often play a role in asset management for investors. And one key asset that pays close attention to the US dollar is gold (and precious metals). Could a near-term trend change be in store for the US dollar and its counterpart, the euro? Precious-metals bulls would love to see the US dollar topping and the euro bottoming.
In the chart below, you can see that the two currencies are showing similar reversal patterns – a traditional head and shoulders top for the US Dollar Index and an inverted head and shoulders bottom for the euro.
BUT, they need to confirm these pattern by breaking down / up.
It’s worth noting that NOTHING has been proved so far, but the potential of both creating longer-term reversal patterns is there and traders should stay tuned.
USD Vs Euro: Reversal Patterns?
USD (top), EUR