-- Published: Monday, 13 February 2017 | Print | Disqus
By Bob Loukas
One aspect of the precious metals market today that I like is the Gold Silver Ratio. It appears to have topped, right along with the 2016 gold bottom, and for all gold bull followers out there this is certainly a welcomed development. Precious metals bear markets always hit silver hard, while bull markets always see Silver outperform gold. As a result, the Gold Silver Ratio rises during bear markets and then falls during bull markets.
On the chart below, the long rising channel represents the precious metals bear market when gold/silver were both sold aggressively. Each peak in the ratio, as seen with the red arrows, correspond with major Cycle price lows. Meaning that as gold sold and collapsed into each yearly low, Silver as a ratio was hammered further.
But that trend has reversed, and silver has for the first time in five years outperformed gold. The chart shows the Gold Silver Ratio has turned lower, meaning that with the last big gold selloff, Silver actually outperformed gold, on a relative basis. It’s not proof of a bear market low, but we do know that every precious metals bull market saw silver dramatically outperform gold. In every case, the Gold Silver ratio turn lower as the entire metals complex went higher. From my perspective, it would appear that the ratio has broken lower and that a new downtrend has been established.
The content on this site is protected
by U.S. and international copyright laws and is the property of GoldSeek.com
and/or the providers of the content under license. By "content" we mean any
information, mode of expression, or other materials and services found on GoldSeek.com.
This includes editorials, news, our writings, graphics, and any and all other
features found on the site. Please contact
us for any further information.
Live GoldSeek Visitor Map | Disclaimer
The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy
or completeness of the information (including news, editorials, prices, statistics,
analyses and the like) provided through its service. Any copying, reproduction
and/or redistribution of any of the documents, data, content or materials contained
on or within this website, without the express written consent of GoldSeek.com,
is strictly prohibited. In no event shall GoldSeek.com or its affiliates be
liable to any person for any decision made or action taken in reliance upon
the information provided herein.