SILVER 1 OZ 999 NY (XAG=X) exploded to one of the widest margins in history

SILVER 1 OZ 999 NY (XAG=X) exploded to one of the widest margins in history

SILVER 1 OZ 999 NY (XAG=X) exploded to one of the widest margins in history

The gold-silver ratio has exploded to one of the widest margins in history, with gold trading almost 85 times the price of silver. The ratio set by law is supposed to be 15-to-1; how did we get to 85-to-1? This is the highest level since the 2007-2008 global financial crisis.

To some degree, having such an extensive history on how the prices of gold and silver relate to one another can be useful for investors. Today’s ratio of nearly 85-to-1 would certainly suggest that silver could be the more attractive investment opportunity than gold at these prices. Of course, markets don’t have to make sense and the ratio could widen still.

When investing in any financial product, hard asset or commodity, there are no rules, only probabilities. Although we like both gold and silver here because of the large spread, we would be bigger buyers of silver. We are looking for both gold and silver to break out to the upside, but first we must suffer through the pain of consolidation.

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

The projected upper bound is: 14.70.

The projected lower bound is: 13.77.

The projected closing price is: 14.24.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 56.2619. This is not an overbought or oversold reading. The last signal was a buy 9 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 43.23. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 11 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 79. This is not a topping or bottoming area. The last signal was a buy 8 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 5 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAG= closed up 0.068 at 14.270. Volume was -0% below average (neutral) and Bollinger Bands were 9% wider than normal.

Open High Low Close Volume___
14.227 14.352 14.140 14.270 0

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 14.15 14.86 16.13
Volatility: 11 20 20
Volume: 0 0 0

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

PREC.M.XAG= is currently 11.5% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect very strong flows of volume into XAG= (bullish). Our trend forecasting oscillators are currently bearish on XAG= and have had this outlook for the last 64 periods. Our momentum oscillator has set a new 14-period high while the security price has not. This is a bullish divergence.

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