• 366 days Will The ECB Continue To Hike Rates?
  • 367 days Forbes: Aramco Remains Largest Company In The Middle East
  • 368 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 768 days Could Crypto Overtake Traditional Investment?
  • 773 days Americans Still Quitting Jobs At Record Pace
  • 775 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 778 days Is The Dollar Too Strong?
  • 778 days Big Tech Disappoints Investors on Earnings Calls
  • 779 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 781 days China Is Quietly Trying To Distance Itself From Russia
  • 781 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 785 days Crypto Investors Won Big In 2021
  • 785 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 786 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 788 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 789 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 792 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 793 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 793 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 795 days Are NFTs About To Take Over Gaming?
Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

  1. Home
  2. Markets
  3. Other

Dominoes

dominoes

What started off as a tinder ignition in the currency markets this fall - namely, the US dollar asserting quiet dominance over each of the major currency crosses (first the yen, then pound, Aussie, the Swiss franc and recently the euro); has now caught flame in the more emotional risk proxies of the hard commodity markets - specifically, gold and silver.

And while silver typically runs the rabbit leg with gold on the risk continuum, the market began heavily selling gold over the past few sessions. This dynamic in turn has arrested the silver:gold ratio in the most recent swoon from undercutting the lows from late December.

To make a long story short, we believe the recent leg lower in the precious metals sector will likely continue - until the silver:gold ratio makes a proportional low. Considering gold has recently led the charge in undercutting its August low, this volatile feedback loop appears to have ample room remaining to inflict additional collateral damages in the short term.

SILVER (SLV) vs GOLD (GLD)
Larger Image

This perspective is also buttressed by the Value Trap comparative - which to date has recognized very similar momentum signatures in how the financials capitulated and led the broader market lower in 2008 and 2009.

Simply put, the miners have done the same with gold and silver here.

Value Traps: VKX:SPX 2008/2009 vs BDX:GLD 2012/2013
Larger Image

 

Back to homepage

Leave a comment

Leave a comment