alice

NFTRH; Gold, Silver, Treasury Bonds & Risk ‘On/Off’

If risk is going ‘off’ then gold’s time would likely come sooner rather than later.  But since we cannot control what the macro markets do we can say it is as yet undetermined whether or not a risk ‘off’ backdrop will come into play for more than the anticipated ‘bounce’.  Right now Treasury bonds and gold are bouncing as expected, but we’ve noted each of them were due for it and should not read more into it than that at this time.

Here are gold and silver at yesterday’s close (they are up again today).  In real time, gold is at 1202 and silver is at 16.87.  Both are considered at or just below key resistance.

gold and silver

As for Treasury bonds, TLT is rising again after consolidating at the 50 day moving averages.  It is not over bought and our best target was around 130.  Not saying it has to go there, but considering the contrary aspects in play and our stepping up to the plate when the world hated bonds, so far so good.

tlt

Now, fellow risk ‘off’ compadre gold (GLD) looks amazingly similar by daily chart, doesn’t it?

gld

Although silver (SLV) is much different and looks to be at a limiting point.

slv

The Silver-Gold ratio continues to look neutral, but suspect.

silver-gold ratio

I am not going to draw any great conclusions from the above because like most people (I assume), I have questions about what is directly ahead (most notably about what the Silver-Gold ratio is going to do).

But speaking as a technical robot, gold and silver are at or near key resistance and Treasury bonds continue to bounce.  If the Silver-Gold ratio breaks down it would signal risk ‘off’ and Treasury bonds would likely fulfill the upside target.  This would not necessarily be bad for precious metals unless it has been ‘inflationists’ pumping them since December.  If on the other hand, the Silver-Gold ratio breaks upward then we are on the ‘inflation trade’.

In that regard, what are Uranium, Lithium and REE (AKA the commodity outliers) telling us?  Are they saying that the inflation trade is ending because these outposts are finally catching big speculative bids or is a 2nd inflationary phase just beginning?  The Silver-Gold/Gold-Silver ratios will soon advise.

Again, apologies for not tying things up with hard conclusions.  I am just trying to get us all thinking about the inputs and possibilities.  I’ll try to be more conclusive in NFTRH 430.  I will note that for those who trade gold and silver, they are at the bounce targets (and resistance).  The metals are at a proving ground, technically.