Hello All readers. This time I want to share a Long Term idea...
$$$ Gold/Silver Ratio $$$
This Ratio has been ranging for a LOOOOOONG time! Around 24 Years! In 2020 , with the spread of pandemic , Commodities Price skyrocketed to new ATHs. Gold was not an exception. In The Time Gold was rising , It was also outperforming Silver which caused the Gold/Silver ratio to rise drastically, But with the scientists finding vaccine for Corona Virus , Commodity prices start to tank. So did the Gold/Silver Ratio. It returned back to the trading range and now Its about to touch the upper band of the Range again. This the point in which chooses Silvers Destiny.
If the Ratio breaks above the Level , Silver will underperform Gold. with every rise in Gold Price , Silver Wonot rise much. with every drop in gold price , Silver price will drop more.
On the other hand , If the Ratio gets rejected from that level , Silver will outperform Gold drastically. With Every rise in gold price , Silver price will rise much more and with Every drop in gold price , Silver price wonot drop much.
Which one do YOU think will happen? Pls comment Below. Im really looking Forward to seeing your Ideas.
Through out history, a Gold to Silver ratio 82-83 has met with fierce resistance. So, I do not see Gold having a problem outperforming Silver up until that level. But at that level we need to see if we will face a strong rejection. If that resistance acts as support then yea we will be seeing Silver get devalued against Gold, but if the resistance acts the way it has the majority of times in history then the reversal is possible and we will have to watch Gold underperform against Silver. The daily RSI indicator chart for this pair has been in an uptrend since December 20. That’s a long time for the RSI not to hit the oversold levels, so that pushes me to believe that the daily RSI has to touch the oversold level anytime soon. Let me know what you think. And thank you for sharing your analysis.
Se7enSkies
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Se7enSkies
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Even if we break the resistance at 82-83, we will face more resistance at around 90.