The Silver/Gold ratio exploded higher after a long post-crash base. “That is usually a sign that the basing phase is done and a up-phase is taking place.” – Captain Obvious
The Silver/Gold ratio is taking a clubbing today and the daily chart shows the breakout is intact and it also shows what is needed to keep it that way.
- Comfortably intact: Top of the green box.
- Less comfortable, but still intact: Horizontal green breakout line.
- Less comfortable still, but still alive: a test of the 50 day average.
I will personally not plan to ride a failure of option 1 above without taking action beyond my ongoing sell here, buy there mode (talking broadly, not just the miners).
In a related matter, you may recall that the SPX Advance/Decline line was shown as a potential double top (possible negative divergence to the stock market) in a public article a couple days ago. Well, I took the liberty of pulling one on gold stocks as well.
This is not a compelling picture of sector internal breadth either. At least for the short-term. The 2025 trend shows healthy internals. Until GDX A/D turns up, we have a caution to not be too bullish for a new bull market leg, in my opinion.
I am trying to let you see what I see and consider relevant. We are only at this point projecting a tradable rally (e.g. silver to 110 +/-), not necessarily a new big bull move. Oh, there is this constant geopolitical/trade/war noise to deal with.
A final note; the GDX/Gold ratio is still intact within its triangle and above both the 50 and 200 day moving averages. It actually ticked a breakout yesterday, but of course the machines (or whatever) are driving it back today.
Things are still on track but there is a lot of noise and variables. We should respect parameters like the above.
