Chart 1: Precious metals could now be ready to break out on the upside
Source: Fin Viz (edited by Short Side of Long)
In recent weeks, I have focused on the overbought and overextended rally in the US Dollar. Personally, I have been apart of this trade by shorting the Aussie Dollar for awhile now, as well as the fact that I hold just about all of my cash in USD right now. And while US Dollar might rise more, from the short term perspective, a correction could be looming. This is especially true with the Japanese Yen, which seems to be incredibly oversold right now.
One of the beneficiaries of the falling Dollar could be the Precious Metals sector. As I write this article, it seems that Gold and Silver are attempting to break out on the upside. As already discussed last week, the tape has turned rather bullish, after a five month downtrend. For those short term traders amongst you, pay attention to the resistance lines and follow the price trend.
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