Gold and Silver are Breaking Out…..

by Greg Harmon
Dragonfly Capital

…..in Euro terms. Remind you of anyone? Well it is true. The ratio of Gold ($GLD) to the Euro ($FXE) is breaking a 13 month symmetrical triangle higher, as shown in the chart below. Consolidating the break higher at 1.32 it has a target from the pattern break to 1.51. If that move

happened solely from a move in Gold prices that would mean a move higher to about 1960 in the price of Gold. The indicators shown, Relative Strength Index (RSI) and Moving Average Convergence Divergence indicator (MACD), also support a move higher in the ratio. And the same thing is showing up in the ratio chart of Silver ($SLV) to the Euro, below, only this triangle is 6 months longer. The target for this pattern is to a ratio of 0.385 or over 50% higher, which would bring Silver back close to $50 if that solely drove the move. This chart looks like it needs a

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