Posted by Francis Koh on 22 Apr 2014

Silver About To Move Higher and S&P Lower

Examine the following graph of Silver versus the Silver to S&P ratio. It tells me the ratio has returned to levels seen in 2008 and that the ratio follows the price of silver. This is interesting but not that helpful.

silver vs SI SP ratio 2004 2014 price         SI SP ratio RSI 2004 2014jpg price

 

Now examine the second graph in which the same ratio is plotted against the 14 month Relative Strength Index of the ratio. The RSI is a timing indicator that ranges between 0 – 100 and indicates buy zones when the indicator is low and sell zones when the RSI is high. Currently the RSI of the index is about 23 – quite low and indicating that the silver to S&P ratio should increase from here. Either the silver price should go up or the S&P should come down, or more likely, both will occur.

Read More: goldsilverworlds.com/price/silver-about-to-move-higher-and-sp-lower/