Silver Breaking Out; Gold Finds Higher Low
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Silver is finally breaking out of the consolidation patter it has struggled with for months. On Wednesday, silver popped almost 3% on the biggest volume day in months. The rally continues today and should continue to run to $17.50-$17.75.
Gold seems to have found a higher low once again but still has not been able to break out to the upside. As we have written for the past few weeks, gold must break above $1,365 and close above for a breakout. For now, gold is still in consolidation and should be observed.
Silver is proving to be the leader; the gold silver ratio has come down from 82 to 78 and should continue to fall. With the current patterns, we would still be a seller of gold and a buyer of silver. Even if gold breaks out to the upside, we expect silver to outperform gold