Gold has been in a persistent downtrend since 2011. Failed rallies have added up and it’s taken its toll on precious metals bulls. 2017 has once again seen precious metals rally… and we are back at a key resistance level. Today, I want to share 2 interesting ratio charts that provide deeper insight into what’s next for Gold (NYSEARCA:GLD). The first chart looks at Gold vs Silver and the second chart looks at the junior gold miners vs the senior gold miners.
What precious metals bulls want to see is “risk on”. What does risk on mean? Higher beta. Typically, silver outperforms gold when precious metals are in a strong uptrend. And smaller gold miners should be outperforming larger gold miners.
In the first chart below, you can see that gold has been under performing silver during this latest run. It’s sitting on key support and bulls want this support to breakdown, with silver leading the rally
CLICK ON CHART TO ENLARGE