The gold/silver ratio points to a high value in silver

The gold/silver ratio is a helpful tool for assessing when it may be better to be in gold or silver positions. Over the last few months, the ratio has been steadily rising as it makes its way up to 100. If the gold/silver ratio does hit 100 then traders should be aware of the silver seasonal pattern that is in place which could potentially support any silver longs.

Over the last 10 years, silver has had an annualised return of 43.29%. Yes, it has had the same up years as down years between July 31 and August 31, but the average return has still been a strong 3.11%. So, if the fundamentals are in place and the gold/silver ratio hits 100 then silver could be a great commodity to buy as we head into the end of the year.

Major Trade Risks: If the USD and Real yields keep moving higher then silver prices can still remain pressured.

HYCM clients can access the Seasonax product in order to analyse over 25,000 currency pairs, indices, commodities, as well as individual stocks. Please contact your account manager for a free trial. Certain products & services mentioned herein may or may not be available to all clients depending on which HYCM Capital Markets Group entity their trading account(s) adheres to.