it seems , precious metals are hedge instruments no doubt, but if fiat was not there and our currency was the precious metals, silver when in more demand than gold and when that demand is highest would indicate a stock market bottom… a highly sensitive and specific statement in last 2 decades
the viceversa also holds true, but but that statement has higher specificity than sensitivity, so is not a ideal way for screening purposes using price charts…
after we all love to hear about market bottoms, people predict market tops by the passing minute…:rofl:
and by a “bottom” i mean areas of accumulation and reaccumulation…
the chart is self depicting , that absolute peaks in the gold/silver ratio correlates with the trading ranges the market went after a protracted fall and a rally…
in smaller time frames this chart holds good,of course with variations…
using the relative strength indicator on the gold silver ratio, its also evident that overbought conditions correlate well with peaks of the ratio and the market trend pauses…
it is also a good indicator when the market is about to rally from that trading range, is when the ratio falls below the 1year moving average and starts resisting from it…
i have never heard anyone use gold silver ratio to apply in stock chart, may be i am ignorant, anyways, this can be used as an accessory tool in the box, kind of an indicator…
anyone interested, please back test in different time frames, and post results…
the viceversa also holds true, but but that statement has higher specificity than sensitivity, so is not a ideal way for screening purposes using price charts…
after we all love to hear about market bottoms, people predict market tops by the passing minute…:rofl:
and by a “bottom” i mean areas of accumulation and reaccumulation…
the chart is self depicting , that absolute peaks in the gold/silver ratio correlates with the trading ranges the market went after a protracted fall and a rally…
in smaller time frames this chart holds good,of course with variations…
using the relative strength indicator on the gold silver ratio, its also evident that overbought conditions correlate well with peaks of the ratio and the market trend pauses…
it is also a good indicator when the market is about to rally from that trading range, is when the ratio falls below the 1year moving average and starts resisting from it…
i have never heard anyone use gold silver ratio to apply in stock chart, may be i am ignorant, anyways, this can be used as an accessory tool in the box, kind of an indicator…
anyone interested, please back test in different time frames, and post results…
Comment:
find time to check other ideas about the indexes..
bonds and the stock market..
bonds and the stock market..
"it is also a good indicator when the market is about to rally from that trading range, is when the ratio falls below the 1year moving average and starts resisting from it…"
this was 2015 reaccumulation , the fall in the ratio and resisting from the 52week MA and the concurrent break in rsi long term support, correlates well with phase d of reaccumulation..
similar picture in current market