In alignment with the still rallying but not yet confirmed macro state of the cyclical inflation/reflation-sensitive copper and other commodities, the indicator that would travel with such conditions is still in bounce mode within its major downtrend as well.
Here is the daily futures chart of the Silver/Gold ratio. It has made 4 waves (no, I have in the least taken up Elliott Waves) and could be starting #5 now. If so the objective would be the top channel line, the rationale for which is shown on the second (weekly) chart below.
First it would have to get through the clear resistance area that meets the down trending SMA 200 above. But Silver/Gold is indicative of what the macro is doing now; rallying, turning people bullish after the terrifying events of late winter and early spring and setting up a reflationary mindset all within a still negative big picture context.
I’ll be open to the wonders of inflation and what it can do to paper over fatal flaws, but not yet in an ultra committed way. Not per this chart, not per copper’s big picture but just maybe per a market that we are using nominally and in ratio to other markets that is instructing inflationary bullish. Okay, I am shoving TMI into this post now. Have another cup of coffee why don’t you, Gary?
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