Via Energy and Gold.com:

Regardless of how one would like to look at things, the eurozone and ECB are driving the global markets bus for the time being. The ECB took the bold step of launching a $1 trillion+ quantitative easing program last month and now the focus has shifted squarely to Greece and how to resolve yet another round of the Greek debt crisis.

Meanwhile, the euro area happens to be the world’s largest currency union and the chart of the euro price of gold foreshadowed the November bottom in the US$ price of gold by not posting a lower low itself amid numerous other bullish divergences. More importantly the € price of gold broke out from an impressive multi-year basing pattern last month:

2-year_Euro_gold

Gold in € terms soared above €1150/oz at the end of January and has since pulled back roughly 6% as the daily chart has formed a textbook bullish flag pattern:

 

Gold_euros_bull_flag

 This is a chart of spot gold divided by EUR/USD (multiply by 100 to get the € price of gold)

This bull flag is either at or very close to the ‘sweet spot’ of the pattern; the RSI(14) is nearly pulled back to the median line and the flag formation is now in its 3rd week (usually the ideal time frame on the daily chart to see a breakout). A breakout above the flag (roughly €1110/oz as of today) would target a move to at least €1200/oz.

Due to the fact that the eurozone has become the world’s largest monetary union and the eurozone economic and debt crisis is at the forefront of the global macro market backdrop It is my belief that the euro price of gold chart is now the key chart to determine the overall trend of the global gold market. This is despite the fact that the vast majority of traded gold changes hands in US dollars and the majority of traders and market watchers remain focused on the US dollar price of gold. You heard it here first, the euro price of gold is now the leading indicator to watch in the future (just as it was at the November 2014 low).