Silver Attempting Bullish Breakout At 20-year Support (SLV)

long and stacked silver bars

Technical analyst Chris Kimble examines the silver/gold ratio on a long-term basis and sees a potential breakout in the works.

This chart looks at the Silver/Gold ratio on a monthly basis over the past 20-years. When the ratio is heading higher, Silver is stronger than Gold.

Since the 2011 highs, the majority of the time the ratio has been heading lower, reflecting the Silver is weaker than Gold.

Numerous times over the past 20-years the ratio has found line (1) to be support, where a rally in the ratio took place, reflecting strength in Silver overd Gold.

The decline over the past few years has the ratio testing support again near the apex of a potential bullish falling wedge.

So far this month the ratio is making an attempt to break above falling resistance at (2). If the ratio would continue to push higher, it could reflect an opportunity in the metals markets.

 


The iShares Silver Trust ETF (SLV) fell $0.06 (-0.39%) in premarket trading Wednesday. Year-to-date, SLV has declined -2.56%, versus a 2.15% rise in the benchmark S&P 500 index during the same period.

SLV currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #8 of 32 ETFs in the Precious Metals ETFs category.


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This article is brought to you courtesy of Kimble Charting Solutions.