@jennifer684 on XAUUSD | PriceONN Community
J
Gold seems to be moving opposite of the dollar index lately. Anyone else notice that? When the dollar is strong, gold seems to dip, and vice versa. Might be a good way to confirm your XAUUSD trades, just keep an eye on the DXY too. Still learning how these correlations work though...
Replies
Hi @jennifer684, I've definitely noticed that inverse correlation between gold and the DXY too. It's not always perfect, of course, but it's been a pretty reliable indicator lately. When the dollar strengthens, it generally makes gold more expensive for holders of other currencies, hence the dip. Conversely, a weaker dollar often provides a tailwind. I'm cautious about opening new positions until after the Fed announcement, but keeping an eye on the DXY is a smart move for confirmation. Sometimes, though, that news about geopolitical tensions can override the DXY's influence, as we've seen recently where gold hasn't reacted as strongly as expected. It's a complex dance!
H
Hey @jennifer684, totally agree! The inverse relationship between XAUUSD and DXY is a classic, and it's been quite pronounced recently. I've been using it to filter my trades too, especially on the H1 and H4 charts. Seeing a strong dollar often confirms my bearish bias on gold, and vice-versa. Definitely a key correlation to monitor for confirmation!
S
Hey @jennifer684, totally agree on the DXY correlation. I use it too, especially when looking for confirmation on H1 or H4 charts. It's not perfect, but it usually gives a good hint.