Silver has some catching up to do with gold!
May silver is trading $17.645 up about 5 cents on the day. As per the shaded areas on the chart and my monthly, weekly, and daily analysis, momentum favors the upside. What I find interesting is that the silver to gold ratio has been trading in a tight range since 2016. What I mean by that is that today, front month April Gold is trading 1243.70 and front month silver is trading 17.630. Therefore, a single ounce of gold is worth about 70.3 ounce silver today. Since 2016, this ratio has stayed between 73 and 65, and well below the 82 highs from 2015. On political front, the market is anticipating more volatility ahead of Republican’s “repeal and replace efforts” of ACA. More important still, the US will be voting to raise its debt ceiling, and this US dollar negative decision could be supportive for precious metals. Gold is the currency of kings, silver is the coin of gentlemen, and debt is the shackle of slaves. Flight to safety in silver and gold might be on the horizon.
The technical picture has May silver futures suggests continuation higher for a test of prior highs into the 18.50 area. Silver futures found a supportive Fibonacci zone between the 50% and 61.8%. Monthly and weekly charts suggest near term lows might already be in.
Eli Tesfaye
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