GOLD/SILVER RATIO STRATEGY #2 BETTER SILVER FUTURES LONG TRADE
DETERMINE WHICH IS THE STRONGEST METAL BETWEEN GOLD AND SILVER
** If the gold silver ratio is in Uptrend and gold & silver in Downtrend: Buy Silver.
If the gold silver ratio is in Uptrend and gold&silver in Uptrend: Buy Gold.
If the gold silver ratio is in Downtrend and gold&silver in Uptrend: Buy Silver.
If the gold silver ratio is in Downtrend and gold&silver in Downtrend: Sell Gold.
The Intermarket relationship between the gold and silver price can reveal a better way to time the metal market.
There may be times when the price of silver makes a new low, but the price of gold doesn’t track that movement.
When something like that happens a possible trading opportunity can emerge.
We can note that the silver price has broken to a new low while the gold price has made a higher low.
This is a break in the gold and silver correlation.
It means that one or the other is lying.
To find out which one, we simply use the gold silver trading strategy rules revealed at step #3.
Based on those rules when the gold silver ratio is up and both gold and silver are moving down, the signal is to buy silver.
For timing the market, we have applied a 20 period MA over the silver chart.
A break above the 20 MA will trigger our entry.
Simple as that!
Final Words – Gold Silver Trading Strategy
When we use the gold silver chart ratio in conjunction with the individual price trends of gold and silver we can determine strong buying and selling opportunities. You can also ride massive trends with the gold silver ratio, especially when we have historical readings. However, since these only happen once or twice in a lifetime you can use our gold silver trading strategy to navigate the day-to-date price action.
The ratio can also be used to determine the overall market sentiment, which is a precious thing that can be used to trade other markets. Usually, a high gold to silver ratio is signaling a slowdown in the global activity, while a low gold to silver ratio is signaling improving risk sentiment.
** If the gold silver ratio is in Uptrend and gold & silver in Downtrend: Buy Silver.
If the gold silver ratio is in Uptrend and gold&silver in Uptrend: Buy Gold.
If the gold silver ratio is in Downtrend and gold&silver in Uptrend: Buy Silver.
If the gold silver ratio is in Downtrend and gold&silver in Downtrend: Sell Gold.
The Intermarket relationship between the gold and silver price can reveal a better way to time the metal market.
There may be times when the price of silver makes a new low, but the price of gold doesn’t track that movement.
When something like that happens a possible trading opportunity can emerge.
We can note that the silver price has broken to a new low while the gold price has made a higher low.
This is a break in the gold and silver correlation.
It means that one or the other is lying.
To find out which one, we simply use the gold silver trading strategy rules revealed at step #3.
Based on those rules when the gold silver ratio is up and both gold and silver are moving down, the signal is to buy silver.
For timing the market, we have applied a 20 period MA over the silver chart.
A break above the 20 MA will trigger our entry.
Simple as that!
Final Words – Gold Silver Trading Strategy
When we use the gold silver chart ratio in conjunction with the individual price trends of gold and silver we can determine strong buying and selling opportunities. You can also ride massive trends with the gold silver ratio, especially when we have historical readings. However, since these only happen once or twice in a lifetime you can use our gold silver trading strategy to navigate the day-to-date price action.
The ratio can also be used to determine the overall market sentiment, which is a precious thing that can be used to trade other markets. Usually, a high gold to silver ratio is signaling a slowdown in the global activity, while a low gold to silver ratio is signaling improving risk sentiment.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.