Silver vs Gold became very over bought by daily charts. Silver also got more suddenly bearish by its CoT configuration. Okay, now let’s juxtapose that against silver’s weekly situation and what do we have?
What we have is a still-intact down trend from the 2011 blow off in silver vs gold and in nominal silver. Further, the ratio is at the top of its long-term down trend channel. Conclusion? Why, gold is better than silver.
A problem for the precious metals sector however, is that silver usually leads the rallies that most gold bugs tend to get excited about.
A problem for most global markets is that silver usually* out performs gold during phases of liquidity and risk ‘OFF’.
So is the silver-gold ratio going to break out of the down trend? Personally, I wouldn’t bet on it.
* In normal markets anyway, which admittedly the last year has not been with regard to some of its traditional functioning vs. the indicators.
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