DOW/ Silver Ratio - Silver Set to Outperform? - Levels to Watch
Silver has been very unloved of late, but if the DOW/ Silver ratio is any guide, then we very well may see a period of out performance quite soon.
Provided we see some key levels taken out.
Metric #1: Trendline Analyis
Monthly: Basic Trendline Analysis
First off let's use some basic trendline analysis, right from the outset we can see the initial move leading up to the 2000 tech peak, followed by the crash and subsequent precious metals run.
The market then reversed at 2013 until today... BUT
We are very close to the lower trendline and should we break below, then this would be a very bullish sign for Silver.
Monthly: Potential Bull Flag
That being said, the current patterns can also be interpreted in another light, because there is also a rather clear potential bull flag, so we will need to see which pattern prevails, the underlying trend is up and a bull flag is bullish, so the likely break would be up, but the global lockdowns may very well have weakened the underlying trend.
Metric #2: Volatility Stop
Monthly: Volatility Stop
The other level to watch is the monthly volatility stop, which is still clearly bullish, but again, should we see a break below and a move from green to red, then this would be a very clear sign of a deteriorating trend.
Metric #3: Moving Averages
Monthly: Moving Averages
The series of moving averages, from 3 to 50, are also a great indicator of trend strength.
Should we see a cross of the moving averages then this would also be a great indicator of trend deterioration.
Final Note: Gold
I also want to contrast with Gold, given that Silver tends to lag the yellow metal.
Monthly: Gold Trendlines
Monthly: Gold Volatility Stop
Monthly: Moving Averages
Clearly Gold is in the phase of out performance to the DOW... and if Silver lags Gold, then i believe that we can see similar out performance for Silver in the not-too-distant future.
Provided we see some key levels taken out.
Metric #1: Trendline Analyis
Monthly: Basic Trendline Analysis
First off let's use some basic trendline analysis, right from the outset we can see the initial move leading up to the 2000 tech peak, followed by the crash and subsequent precious metals run.
The market then reversed at 2013 until today... BUT
We are very close to the lower trendline and should we break below, then this would be a very bullish sign for Silver.
Monthly: Potential Bull Flag
That being said, the current patterns can also be interpreted in another light, because there is also a rather clear potential bull flag, so we will need to see which pattern prevails, the underlying trend is up and a bull flag is bullish, so the likely break would be up, but the global lockdowns may very well have weakened the underlying trend.
Metric #2: Volatility Stop
Monthly: Volatility Stop
The other level to watch is the monthly volatility stop, which is still clearly bullish, but again, should we see a break below and a move from green to red, then this would be a very clear sign of a deteriorating trend.
Metric #3: Moving Averages
Monthly: Moving Averages
The series of moving averages, from 3 to 50, are also a great indicator of trend strength.
Should we see a cross of the moving averages then this would also be a great indicator of trend deterioration.
Final Note: Gold
I also want to contrast with Gold, given that Silver tends to lag the yellow metal.
Monthly: Gold Trendlines
Monthly: Gold Volatility Stop
Monthly: Moving Averages
Clearly Gold is in the phase of out performance to the DOW... and if Silver lags Gold, then i believe that we can see similar out performance for Silver in the not-too-distant future.
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