DAX / Gold arbitrage opportunity in 2015

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A long-term analysis of the DAX             / Gold             ratio shows a likely continuation of the rally in European stock markets and/or fall in gold             prices in the coming months if this ratio breaks its multi-year trendline resistance (red line). Since the beginning of 2014, this ratio has been printing a series of lower highs ans lower lows, but we may see a new leg higher next year so long as the October lows hold. Given that gold's ( XAUUSD             ) support broke this past week, it seems likely that this ratio will push higher for the rest of the year. So long-term investors and traders alike can look for a break above the 11 handle on this ratio to maintain a constructive stance on the DAX index             next year / bearish biais on Gold             .

***Gold is quoted in EUR here (i.e. XAUEUR)
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