|
The actual price chart is in the bottom section with a 150 day moving average in green. The middle section is a Comparative Relative Strength index with the Gold price (US). Over the past 30 years at least the ratio of the Gold price to the Silver price has traded in a range from as high at 100 to 1 in the early 90's (The end of the bear market in Silver) and as low as 15 to 1 at the height of the last bull market in the 70's and 80's. At the present time the ratio is about 55 to 1. This ratio over time has tended to trade in various channel formations. The index above is a Silver to Gold ratio, so to get the appropriate Gold Silver ratio you just have to divide the number into 1. You can see over the past 5 years this ratio is trading in a new channel. When the index has hit support (Green vertical lines) this has been a pretty handy time to buy with the SIlver price rising dramatically over the following 8-12 months. The resistance line has also proven to be an excellent profit taking indicator (Red vertical lines) with signifcant corrections occuring shortly after. The top section of the chart is a standard 14 day RSI which up until now has provided a reliable point to add to positions when an RSI of 30 is hit.
|
