Technical Analysis – Gold / Silver Ratio – Supporting bullion rally

Dec 10, 2013 - 12:57 PM GMT
by
Short Term:
Medium Term:
Long Term:
Resistances:
R1 64.12 Recent high
R2 67.40 July peak
R3 68.70 Aug 2010 high
R4 71.43 Feb 2010 high
Support:
S1 61.51
S2 59.68 Nov low
S3 58.44 Oct low
S4 56.94 August low
Stochastics:
Legend:

Technical Comment

Analysis

  • After a strong run-up in the ratio, it now looks as though the ratio is correcting, wth a recent support level at 61.51 now the first line of support.
  • The pullback in the ratio suggests sentiment might be turning more bullish – it points to buying coming into silver as a cheaper proxy for getting into gold.

Conclusion

A drop below 61.50 would start to look more interesting in terms of suggesting a stronger run-up in bullion prices.

All trades or trading strategies mentioned in the report are hypothetical, for illustration only and do not constitute trading recommendations.