Yesterday morning I suggested that shouldthe Jan. 5 lowin silver break, a move to $22.55 would become likely; the price came to within 5 cents of that low; the below 4-hour chart shows the metal still moving sideways. There is reason to continue to give silver bulls the benefit of doubt to take another crack at $24.50 as long as the bottom trendline holds (and I discussed buying dips yesterday).
Note theJan. 5low in gold, also shown below on a 4-hour chart. For gold, that low is the starting point of an upward-sloping trendline rather than the bottom of a consolidation box like in silver. Gold has been outshining silver over that past two weeks, but bulls would like for that to change. Is silver resting before the next leg up, or is gold’s outperformance signaling that the pullback I have been suggesting should be expected is close to manifesting?
The gold/silver ratio is shown below on the daily chart. It has broken above the downtrend line (dating back to September 2022), as well as its 50-day MA, accounting for gold’s outperformance over the last two weeks. However, it is currently stretched to the upside, and a pullback to that 50 MA and/or breakout point from the downtrend line would not surprise.
Will silver bulls take it over $24.50 before a pullback? The ratio indicates at least another run at it is likely.
Thanks and have a great weekend.
