opinion

Silver sizzling, but is it overdone?

Kitco Media
By Jonathan Da Silva
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Silver sizzling, but is it overdone? teaser image

(Kitco Commentary) - Last I wrote, I suggested that silver was just about ready to pop; since then, silver has gone on to outperform gold in a drastic fashion.

Below is a weekly chart of the gold/silver ratio. Note the top last week at around the 90 resistance level, immediately proceeded by this week’s big red candle.

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My expectation is that the ratio drops farther, for a test of the rising trendline. Note momentum turning down on the stochastic indicator with lower, horizontal support, represented by the yellow rectangle.

I continue to give metals bulls benefit of the doubt. I anticipate ( that a test of the 76 level would correspond to the $30 silver level, which implies a gold price of $120 higher than where spot currently sits.

Thanks and good luck,

Kitco Media

Jonathan Da Silva

Jonathan Da Silva developed a passion for hard money and economics from a young age having been influenced by family who sought to teach me that "nothing is free", and the importance of intrinsic value early on. My interest in markets grew keener during the great financial crisis of 2008; leaning on family with vast trading experience, I began to self-educate on technical analysis and economics- drawing inspiration from the works of individuals like W.D. Gann and Adam Smith. I have been a proud member of the Kitco team since 2017 and hope that my writing inspires readers to consider an objective view of the metals, and the greater financial markets.

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