(Kitco Commentary) - The silver price meandered around 78.00 last week after having closed below that level the week prior. However, bulls fought hard on Friday, Feb. 20, and pushed the silver price clear over 78 with a move of more than 6%, which continued last night into the next resistance level at around 86.50, where the price currently sits.
The next level up is another $6 or $7 higher, around $93. The four-hour chart below shows the support and resistance levels for silver, highlighted with gold rectangles. Not marked is resistance at 105 should bulls break through $93.00.
Gold has been dragging silver off the bottom, with bulls recapturing $5,100.00 after a series of lower highs discussed in my last piece finally led to an upside break.
We may be at an important inflection point in the gold-to-silver ratio. Major volatility around a support or resistance level can signal indecision and repositioning. It remains to be seen which direction the ratio will move — either higher toward the 79/80 level mentioned in my prior writing or back down to the low 40s.
Those seeking to capture further potential upside in the metals, but who are wary of volatility, might elect to take exposure in gold over silver at this juncture, with the yellow metal leading the charge.
