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Goldsilverratio

Gold Silver Ratio About to Explode?While the Head and Shoulders pattern is often associated with a topping formation (or bottoming in the case of an inverse head and shoulders), it can often show up as a continuation pattern. Since most of the articles I have read recently about the Gold:Silver ratio state that silver comes out of the ground together with gold in a15:1 ratio, that the market should value this ratio at a level closer to that rather than the recent levels of 80. Some state that historically a ratio of 30 silver to 1 gold is the average. TradingView data goes back 20 years and the chart is quite revealing. It does appear that, based on the head and shoulders continuation formation, that gold is set to greatly outperform silver going forward. Recently, both gold and silver have been falling due to higher US interest rates and a subsequent rising dollar. Silver's recent attempt to reach previous highs of several weeks back failed and the reversal appears to be strengthening, possibly causing silver (SLV) to fall to 13 or even under 10! On the opposite side, in an effort to by-pass US sanctions on Iran, Russia and other countries are looking for alternative payment methods instead of the US dollar. This might add demand to the gold side of the equation. Nothing is yet written in stone and a breakout and test of that breakout level still needs to occur for this ratio to fulfill the measured move expectations of the head and shoulders pattern, but it's good to know that perhaps the more common narrative that the gold silver ratio is too high and needs to come down, along with the other common narrative that the Commitment of Traders report shows that speculators are heavily short silver proves that silver is due for a pop, may all be wrong.
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by Glewis54
1
Is the silver market ready to Rally?The last 2 years the silver market is behaving similar to mid 2003 to mid 2005. Even if we assume that the Stock Market, Bond Market and Housing Market will not correct the coming 2 years, the Silver Market looks really bullish. Especially if we take into consideration the recent capitulation in the bullion market (www.bullionbaron.com), the "Crushed Profit Margins At Largest Primary Silver Mining Producer"(www.moneymetals.com), a historically high GOLD/Silver ratio and the fact that nowadays we are using Silver for industrial purposes more than ever, the long position constitutes a relatively safe bet.
TVC:SILVERLong
by WiseTraderIO
2
Why Gold And Silver Could Be Supported In 2017 And BeyondFirst of all, in a technical perspective we shouldn’t deny that Gold and Silver are in an intact long trend with higher highs and higher lows from the last significant low of 12/15/16, where the market bottomed at around 1123 US$/OZ in gold and 12/23/16 at around 15.64 US$/OZ in silver. From their gold rallied about 12.52% to 1263.14 and is now currently pulling back from recent levels. Same with silver. Silver rally about 18.44% to 18.48. Which is +5.93% more than gold up move, which is quite impressive. Both are in a long trend but the question is now how substantial these moves are. Well, this question is hard to answer. Having a look on this chart above, which show’s us the gold to silver ratio, which is simply gold divided by silver. But what does this chart tells us, or even better what is the definition of this ratio firstly? Well, the gold to silver ratio says how many silver ounces it takes to buy one ounce of gold. Which basically tells us how many ounces of silver we need to purchase one ounce of gold. Before we get into details, here is first a short example. Currently, the Gold to Silver ratio is approx. at 69.34. Which tells us simply that we need 69.34 ounces of silver to purchase 1 ounce of gold. Not that hard right :-)?! But why do I need this information now, you might ask yourself? Well, the easiest answer for that is, it could signal us potential big moves in those particular precious metals. The gold to silver ratio is negative correlated to gold and silver. For this general purpose, we will simply say that when the gold to silver ratio rally gold and silver will fall. Obviously, the gold to silver ratio is highly volatile and fluctuates widely, that you can’t just buy or sell accordingly to the ratio. But what you can do is you can potentially forecast big weekly moves. The 18 years’ gold to silver average ratio is approx. 61.75 whereas the all-time average is currently around 56.19. Either way, which number you take, you see that the current ratio is way too overvalued. This is one of many fundamental perspectives on how to look at it. But why do we think that Silver could be gaining on a percentage basis more than gold? Well, have a look at the current correlation of gold and silver above. Silver has a constant negative correlation to the gold ro silver ratio whereas gold has a shallow negative correlation. This is also one of many indications, that why we think that silver will be more supported than gold throughout 2017 and way beyond 2017. Don’t get us wrong, gold will be also supported but the more interesting metal will be silver, due to the higher and constant correlation to the gold-silver ratio. --> See Comment section for continuation of the article. Hope this helps. Wish you a relaxed weekend.
TVC:GOLDLong
by secrets2trade
Educational Study: HOW TO TRADE "SPREAD"Educational Study: HOW TO TRADE "SPREAD" SPREAD is a strategy in future market. There are two spreads: Inner Markret / Inter Market Inner Market: Buy the GOLD FUTURE IN DEC and SELL GOLD FUTURE in Jan, or vice versa. Inter Market: Buy the Gold and Sell Silver or Sell the gold and Buy the silver. The beauty of this strategy is: You are safer for risky events such as FOMC Meeting. i.e. no matter what happens, gold and silver they will move together. and base on the location, I prefer to buy the gold and same time sell the silver for this FOMC meeting.
FX:XAUUSDLong
by tntsunrise
10