The Golden Rule For Gold Last Week

With gold falling 3.4% last week, you might expect that the yellow metal became more negatively correlated with currencies, especially those whose economies are tied to resources. And that's exactly what happened, particularly with currencies whose countries fortunes are tied to gold.

At Excalibur Pro, we have a number of tools that help follow correlations. We looked at our Relationship Building module at the end of the day on Nov. 13, comparing gold against all currencies and using a 5-day average correlation calculation. We then compared that graphic with the one from exactly one-week before (Nov. 6 closing data). It is striking how more negatively correlated that gold move made it against currencies.

If you expect currencies like AUDUSD (very gold-based economy) to realign with gold and become more positively correlated, there may be a trade in the near future for you.