Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

The Dow/Silver Ratio Signals All-Time High Silver Prices

Commodities / Gold and Silver 2016 Jun 20, 2016 - 03:57 AM GMT

By: Hubert_Moolman

Commodities

I have written extensively about the relationship between the Dow and silver prices. One of the points I have emphasized, is the fact that Dow peaks are often followed by silver rallies.

Given the above, its natural that the Dow/Silver ratio is also an important indicator for future silver prices. One example of this, I deal with in my silver fractal analysis report:


Silver Futures Chart

The top chart is the Dow (from 1980 to 1994), and the bottom is silver (from 2000 to 2012) - both charts are from tradingview.com.

In 1980, the Dow made a bottom, as measured in silver (Dow/Silver ratio bottom). For silver, a similar bottom would be when the Dow/Silver ratio peaked in 2001. For both charts, these points (respectively) were at significant lows (significant lows just before the start of the bull market).

The first important peak for the Dow, since the Dow/Silver ratio bottom came about after 7 years (and 7 months). For silver, the first important peak came about 7 years after the Dow/silver ratio peak.

The second important top for the Dow came about 10 years (and 6 months) after the Dow/silver ratio bottom. For silver, the second important top came about 10 years after the Dow/silver ratio peak.

This clearly shows that there is a measurable relationship between silver prices and the Dow, and that one can use the Dow/Silver ratio to help predict future silver prices. For example, this ratio will be very instrumental when formulating an exit strategy for silver.

Below, is a long-term chart of the Dow/Silver ratio (from tradingview.com):

On the chart, I have indicated some key financial events. I have also marked two fractals (A to D). Both fractals or patterns, exist in a similar manner relative to the key events indicated.

Point A (of both patterns) is at the peak of the Dow/Silver ratio, just before the start of the silver bull market. In both cases, silver made a major bottom, soon after the Dow/Silver ratio peak.

Point B (of both patterns) is the bottom of the Dow/Silver ratio, just after a significant silver peak.

Point C (of both patterns) is the top of the Dow/Silver ratio, right at a significant silver bottom. On the 1970s pattern, point C was the low before we eventually had the rally that took silver to the then all-time high of $50.

If the comparison of the two patterns is justified, then we will have a similar rally (in the near future) that will take silver to a new all-time high. Furthermore, the top of the Dow/Silver ratio in 2001 is most likely a mega-top. Given that this is likely a mega-top; I would expect the Dow/Silver ratio to go lower than the 1980 low.

For more on this and this kind of fractal analysis, you are welcome to subscribe to my premium service. I have also recently completed a Silver Fractal Analysis Report as well as a Gold Fractal Analysis Report

Warm regards

Hubert

“And it shall come to pass, that whosoever shall call on the name of the Lord shall be saved”

http://hubertmoolman.wordpress.com/

You can email any comments to hubert@hgmandassociates.co.za

© 2016 Copyright Hubert Moolman - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in