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Gold:Silver Ratio From a Chart Perspective

Cory
July 31, 2017

There is an ongoing debate about whether the gold to silver ratio (on a absolute basis when compared to historical averages) is useful for investors to consider when assessing the broad metals markets. However I do find value in looking at the charts and looking for changes in direction. This is what the chart and blurb below from our friend Chris Kimble of Kimble Charting Solutions is outlining. A potential double top could be occurring which would be bullish metals!

Click here to visit Chris’s site for more great, straight forward technical commentary.

Gold & Silver Ratio could be creating very bullish pattern!

Below looks at the Gold Futures/Silver Futures ratio over the past decade. The ratio bottomed in 2011 and started moving higher, sending a bearish message to both Gold & Silver. The ratio has rallied since the 2011 lows, where it could be creating a “topping pattern” over the past couple of years.

CLICK ON CHART TO ENLARGE

The long-term trend in the ratio remains up since 2011, which is hard on metals. Over the past couple of years, the ratio could be forming a head & shoulders topping pattern, with the head taking place at the highs back in 2008. The short-term rally of late, could have completed the right shoulder, of this pattern at (2).

If this would happen to be a topping pattern, what it does at (3) becomes very important for both Gold & Silver bulls. Metals bulls want to see this ratio break support at (3) and head lower. If the ratio would break support, historically Gold, Silver and Miners would attract buyers.

If staying on top of pattern in Gold, Silver, Copper and Miners is of interest to you, we would be honored if you were a Premium or Metals members, as charts like this are shared each week with these members.

Discussion
58 Comments
    cfs
    Jul 31, 2017 31:33 PM

    Scaramucci gone already!

    Jul 31, 2017 31:48 PM
    Jul 31, 2017 31:58 PM

    Copper looking good TA and fundamentally

    cfs
    Jul 31, 2017 31:30 PM

    Cory, Big Al, you are going to miss the boat if you don’t start to cover cryptocurrencies.

    Is this not Korelin Economics Report, as contrasted with Korelin/Fleck Metals Report?

    Listen to this:
    https://youtu.be/zeyGEAAbbXs

    Trace Meyer understands part of the future.
    I don’t believe he understands what will be the response of governments, when they see their power of control over people and money being reduced. But that has not happened yet.

      Jul 31, 2017 31:50 PM

      CFS:
      And what government specifically?
      Good luck with that.

      Aug 01, 2017 01:51 AM

      CFS:

      The biggest difference between tulip bulbs and cryptocurrencies is that governments can shut down the cryptos in an instant. And they will as soon as they become any kind of a threat.

        Aug 01, 2017 01:03 AM

        Mr.Moriarty:
        Any new knowledge comes from those who question the status quo and have a willingness to go beyond and a willingness to accept the next answer.

          Aug 01, 2017 01:11 AM

          JohnK:

          Anyone who has read Extraordinary Popular Delusions would understand cryptocurrencies in a minute. This time it’s different is never so.

            Aug 01, 2017 01:46 AM

            Mr Moriarty:
            I’ve read the book and I have been scammed before.
            In one years time if Bitcoin is worth nothing I will admit that I was foolish,accept my loss and move on.
            On the other hand if Bitcoin is something and is increasing in value, you will still call it a scam.
            Let’s revisit this in a year.

            Aug 01, 2017 01:06 AM

            JohnK, price doesn’t prove whether or not it is a scam; it only proves whether or not the market believes it’s a scam.

            It blows me away that the average guy is most confident after a big move when an asset is expensive rather than before a big move when an asset is cheap. Confidence in BC is particularly strange because no one knows what it is worth even if we assume that governments can’t touch it.

            Aug 01, 2017 01:52 AM

            Mathew:
            Exactly, the market is always right.Only we are wrong.

    cfs
    Jul 31, 2017 31:18 PM

    Now it comes out that John McCain is just as big a traitor as the Clintons.

    McCain’s tax-free Institute has been receiving donations from Scumbag Soros and Saudi Arabia, which $1 million.

      Jul 31, 2017 31:28 PM

      And for all the lives he has destroyed and the harm he has caused, he gets to sleep undisturbed forever . . . not if there is a God in Heaven.

    cfs
    Jul 31, 2017 31:30 PM
    GH
    Jul 31, 2017 31:58 PM

    I don’t have a strong opinion on the matter myself, but I think this alternative view is worth considering as well:

    https://www.jsmineset.com/2017/07/30/be-prepared-the-coming-cashless-society/

    “Banking institutions have allowed them to remain so far, only because it reinforces their agenda toward a cashless/digital currency. The more accepted digital (crypto) currencies are, the easier it will be for governments and financial institutions to push their agenda of eliminating physical currency.”

    GH
    Jul 31, 2017 31:26 PM

    In case no one has posted it, Maund:

    https://www.clivemaund.com/article.php?id=4246

      GH
      Jul 31, 2017 31:30 PM

      The dollar is certainly oversold, and has the sentiment factors that Maund discussed favoring a rally. But as this chart shows, it often gets stretched further below the 200 day EMA than this.

      http://stockcharts.com/h-sc/ui?s=%24USD&p=D&st=1980-01-01&en=today&id=p63541489662&a=537366556

      And there is reason to think this year’s dollar top is comparable to those of 1985 and 2001/2, in which case after a brief relief rally, it could plummet further.

        Jul 31, 2017 31:40 PM

        Large declines often begin from oversold readings. I did well last year by taking the other side of a lot of Maund’s calls but I agree with him now.

        Jul 31, 2017 31:42 PM

        I consider my current short term uncertainty to possibly be a bullish contrary indicator. We’ll know very soon which way things are going.

    CFS
    Jul 31, 2017 31:49 PM

    Int’l Speculator upgrades Kirkland Lake Gold to buy

    2017-07-31 20:19 ET – In the News

    CFS
    Jul 31, 2017 31:54 PM

    2017-07-31 19:31 ET – News Release

    Mr. Sean Roosen reports

    OSISKO COMPLETES ACQUISITION OF ORION ROYALTY PORTFOLIO

    Osisko Gold Royalties Ltd. has completed the previously announced acquisition of a high-quality precious metal portfolio of assets consisting of 74 royalties, streams and precious metal offtakes from Orion Mine Finance Group in exchange for $675-million cash and the issuance of 30,906,594 shares of the corporation.

    Following the acquisition, Osisko now holds a total of 131 royalties, streams and precious metal offtakes, including its cornerstone 5% net smelter return (“NSR”) royalty on the world class and long-life Canadian Malartic gold mine (Canada’s largest producing gold mine) and a 2% to 3.5% NSR royalty on the world class Eleonore gold mine. In addition, the Corporation acquired a 9.6% diamond stream on the Renard diamond mine and a 4% gold and silver stream on the Brucejack gold and silver mine, all of which are new high-quality mines in Canada, in addition to a 100% silver stream on the Mantos Blancos copper mine in Chile.

    Jul 31, 2017 31:22 PM

    For those of you interested Rick Rule was on bnn’s market call today..so far the link to the whole program isn’t uploading..when it is I will post it..

    Jul 31, 2017 31:28 PM

    GH, according to Clives charts, the dollar is now in vital support territory having dropped the 93 handle. This week could be significant in seeing where the dollar goes in the medium term. Hes not always right but this current dollar chart analysis of his does seem to have some validity. I could be wrong too. Certainly no expert.

    Jul 31, 2017 31:44 PM

    The CRB finished the month up 4.5% and looks good for much more upside to come.

    Monthly:

    http://stockcharts.com/h-sc/ui?s=%24CRB&p=M&yr=20&mn=11&dy=0&id=p31144767428&a=536979933

    Jul 31, 2017 31:45 PM

    Copper hasn’t looked so good in years.

    Monthly (sorry):

    http://stockcharts.com/h-sc/ui?s=%24COPPER&p=M&yr=17&mn=2&dy=0&id=p68694881231&a=537266072

      Aug 01, 2017 01:17 AM

      Dr Copper has looked strong as of late. Very encouraging for a number of miners with copper exposure and for commodities as a whole. The low US Dollar has been a contributing factor, as well as some supply destruction in the market from older mines in Chile, Argentina, Peru, and Australia on halt or with depleted resources.

    Jul 31, 2017 31:58 PM

    The S&P was more than cut in half versus the senior gold miners last year and looks like it’s getting ready to plunge again.

    Despite the correction in the miners and continued gains in the stock market this year, the S&P is till 31%+ below its 2015 high versus the miners.

    SPX:GDM weekly:

    http://stockcharts.com/h-sc/ui?s=%24SPX%3A%24GDM&p=W&yr=6&mn=1&dy=0&id=p54988298047&a=446462272

    cfs
    Jul 31, 2017 31:34 PM

    Trump ordered an end to CIA involvement in Syria and we know why:

    http://www.weeklystandard.com/trump-got-this-one-right/article/2009045

    When is he going to end the CIA involvement in Afghanistan and all the opium smuggling.
    He knows the US has a big heroin problem, because he said so.
    When will CIA heads roll?

    cfs
    Jul 31, 2017 31:47 PM

    They are still cheating on Global Warming data all over the world……the only difference is that intelligent scientist are now watching.

    http://dailycaller.com/2017/07/31/australia-weather-bureau-caught-tampering-with-climate-numbers/

    Aug 01, 2017 01:07 AM

    Still can’t get the full video to play but here’s his tops picks
    http://www.bnn.ca/rick-rule-s-top-investing-ideas-july-31-2017-1.818437

      GH
      Aug 01, 2017 01:14 AM

      Nice review of the history, though it neglects the role of the Neocon Zionists.

    Aug 01, 2017 01:13 AM
    CFS
    Aug 01, 2017 01:12 AM

    2017-08-01 08:12 ET – News Release

    Mr. John Burzynski reports

    OSISKO INTERSECTS 63.2 G/T AU OVER 7.7 METRES AT WINDFALL

    Osisko Mining Inc. is providing new results from the continuing drill program at its 100-per-cent-owned Windfall Lake gold project located in Urban township, Abitibi, Quebec. The current 400,000 metres drill program combines definition drilling in Zone 27, definition drilling above the Red Dog intrusion (“Red Dog”), expansion drilling above and below Red Dog, and expansion/definition drilling in the adjacent Lynx deposit located immediately to the NE of Windfall.

    Aug 01, 2017 01:24 AM

    The monthly $hui chart makes me think we have at least another red month in front of us in the near term, primarily due to the stochastics, which have not yet reached oversold. It’s possible they turn back up here, but that is a rare occurrence indeed.

    http://stockcharts.com/h-sc/ui?s=%24HUI&p=M&st=1996-08-01&en=today&id=p39797514931&a=537457679&listNum=1

    A few months ago I said GDX/$hui would hit the lower monthly bollinger before hitting the upper bollinger. That is still something that is in the cards.

    Aug 01, 2017 01:29 AM

    No man’s land–we are now inside a GIANT red Ichimoku cloud on the monthly GDX chart:

    http://stockcharts.com/h-sc/ui?s=GDX&p=M&b=5&g=0&id=p61685593156&a=537458984&listNum=1

    BDC
    Aug 01, 2017 01:35 AM

    A Dollar washout may have just occurred (10et).

    Aug 01, 2017 01:43 AM

    The GDXJ:GLD ratio is about to explode, up or down. It doesn’t get any tighter than this!

    http://stockcharts.com/h-sc/ui?s=GDXJ%3AGLD&p=D&b=5&g=0&id=p58318982303&a=537461400&listNum=1

    given where gold (and USD) is in its cycle, when it drops, you would think the miners will get absolutely hammered and that ratio will spike downwards. That being said, you just never know. Expect the worst though.