Gold vs Light Sweet Crude Oil (XAUOIL)

XAUOIL compares price dynamics of gold and another commodity with absolutely different characteristics, oil. Different nature of the two assets and their possible opposite reactions to considerable global driving forces make the instrument an attractive investment opportunity as its price movement can be well explicit.

According to the chart below the instrument may be considered as preferably more growth oriented in periods of increasing uncertainty. Further analysis suggests relatively cyclical character of the instrument, as the graph is rich in double top/double bottom patterns. The analysis also helped detect the reversal point in traditional oil futures contract in February 2009. The second peak of the double top pattern coincides with the oil price bottom around $33 per barrel.

Chart reflecting XAUOIL recent dynamics

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