Gold Miners - SPX500 Ratio: Opportunity of a Lifetime
Updated
As you should know, ratios are measured from 0-1. The Gold mining sector hit its all-time high in 1984, registering a 0.9 on the ratio.
An individual company can go to zero, but an entire sector like metals cannot unless humanity gets wiped out. The mining sector is the closest to zero it has ever been. The last time it was this low was when gold bottomed in the year 2000 and the ratio bottomed at 0.03. Currently, the ratio sits at 0.025. I couldn't figure out how to make tradingview show additional decimals. In 2011 the ratio hit 0.2. That move from 0.03 to 0.2 from 2000-2011 was a roaring bull market in metals.
In the next chart, I'm going to publish, you will see that not only is the gold mining sector the cheapest it has ever been versus the US stock market, it is also the cheapest it has ever been versus the price of gold itself. For those paying attention, the opportunity in precious metals is right now.
A lot of investors right now are suggesting to sit on cash in preparation to buy a crash. In my opinion, the cash you should be sitting on is metals, not dollars. The mining sector is a long-term hold in my eyes. I also see intermediate profit opportunities in swing trading the metals in the 6-12 month TF.
An individual company can go to zero, but an entire sector like metals cannot unless humanity gets wiped out. The mining sector is the closest to zero it has ever been. The last time it was this low was when gold bottomed in the year 2000 and the ratio bottomed at 0.03. Currently, the ratio sits at 0.025. I couldn't figure out how to make tradingview show additional decimals. In 2011 the ratio hit 0.2. That move from 0.03 to 0.2 from 2000-2011 was a roaring bull market in metals.
In the next chart, I'm going to publish, you will see that not only is the gold mining sector the cheapest it has ever been versus the US stock market, it is also the cheapest it has ever been versus the price of gold itself. For those paying attention, the opportunity in precious metals is right now.
A lot of investors right now are suggesting to sit on cash in preparation to buy a crash. In my opinion, the cash you should be sitting on is metals, not dollars. The mining sector is a long-term hold in my eyes. I also see intermediate profit opportunities in swing trading the metals in the 6-12 month TF.
Note
On the cusp of a breakout!
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