Market Curiosity: Exploring Markets And Systems

March 22, 2014

Possible SLW buy based on SLW : Silver ratio

Filed under: Just Watching — Tags: , — Jeff Fitzmyers @ 9:17 am

Ed Steer: For the week:
– Gold was down 3.4
– The HUI lost 8.6%.
This is normal

– Silver was down 5.5%
– Silver stock index closed lower by only 2.9%.
This is not normal. Typically the index should be down over 10% (if not 5,000%!). The typical explanation is that strong hands are buying silver shares and silver and the silver shares should go up soon. When the top is near, silver should keep going up, and silver shares should under preform.

Graphically, the SLW : silver ratio is rising, suggesting more upside in general. If true, for the next few days, SLW is a buy on a stop of about 25.5, with stop loss a bit under 24.5.

SLW Ag ratio MAR 22 2014

Update 1, May 4 2014
And avoiding that down draft is why I like to buy on a stop. A small divergence seems to have marked a local bottom.
Ag SLW ratio May 4 2014

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