Gold – Silver Ratio reaches 26-year high

[Wolves]

Gold – Silver Ratio reaches 26-year high.

The gold – silver ratio reached a high of 87.136 on Wednesday; the highest in 26 years. Having trended upwards since 2016, investors are asking themselves how long it can keep climbing.

The gold - silver ratio is the relative difference between the price of gold and the price of silver, and is simply calculated by dividing the two. In practical terms, Wednesday’s ratio means that for the price of an ounce of gold, you could buy just over 87 ounces of silver, and could be a signal of an imminent price increase for silve.??????

[DarkChameleon]

1 hour ago, Wolves said:

Gold – Silver Ratio reaches 26-year high.

The gold – silver ratio reached a high of 87.136 on Wednesday; the highest in 26 years. Having trended upwards since 2016, investors are asking themselves how long it can keep climbing.

The gold - silver ratio is the relative difference between the price of gold and the price of silver, and is simply calculated by dividing the two. In practical terms, Wednesday’s ratio means that for the price of an ounce of gold, you could buy just over 87 ounces of silver, and could be a signal of an imminent price increase for silve.??????

Some people were stating that when silver was under 70-1...they assumed it would drop to 40 to 1...sadly they are still waiting...I'm hoping the ratio stays about the same but both rise as the printing out of currency weakens the value of everything but pms.

[SiliconToad]

@Wolves  I don't understand why there should be any particular price ratio of silver to gold. When the metals were pegged to each other though a currency, then the ratio of metals to each other and their related fiat made sense. Very problematic, but made sense nonetheless. These days, the metals are mined differently, have different applications and are viewed as different asset types linked only by being in the same "basket" at the government/central banking level.  

Silver could drop to $0.50/oz and gold could rise to $10k/oz and it would make the same sense as if the metals found 1:1 parity. 

[sixgun]

Silver is a currency as is gold, which are traded on the Forex markets. The exchange ratio of gold for silver is what the gold:silver ratio is - XAU/XAG. This is what it is despite denials from many quarters and why the gold silver ratio ever gets quoted.

Silver could not drop to $0.50/oz - it can on a paper market when there is no delivery or connection to reality but the paper market is not completely out of synch with reality. A $0.50/oz could not happen b/c before we got there, there would be such an explosion in buying it would exceed all the deliverable silver in the world and the market would break.

Silver is used as a lever on the gold price. It works as a lever on gold b/c there is a link between gold and silver. This week we saw the silver price dumped on as price was actually starting to take off. This was intervention by central banking entities. The price was taking off and then boom the price falls like a stone. Gold did not move as sharply down as silver did. The data from the Fed said gold should go up - the price started moving up and then the silver price crashes. If silver is an industrial metal and silver is unconnected to the top predator money - gold; then why should the silver price dump hard? It happened b/c silver is easier to control and send down and it was being sent down to put pressure on the much larger gold market. With the dump in the silver price we saw the spike in the gold:silver ratio. There was a correction on Friday and silver bounced back.

So my view on the very high gold:silver ratio is that silver is because silver is being used as a lever to keep a check on the gold price. Could the ratio go higher? Yes it could and i expect that to happen in the early stages of loss of control on the gold price. Gold would rise, silver would be pressured, that pressure isn't working but the G:S ratio climbs. Then i would expect a snap back and the ratio falls. i remember 2010 - 2011 when silver fever grips the price becomes manic.

i have started minting on the Kinesis currency exchange where you buy physical gold and silver and get issued with blockchain title of ownership. i minted silver on Wednesday and Thursday. One lot on each day - 200oz per lot. It is interesting to see that in dollar terms the amount of silver that is being minting is much higher - i don't know the exact figures but at the end of the week i could see activity in silver really took off with someone minting $300k worth of silver in one go. Things haven't got going as you cannot trade the Kinesis currency until July but there are some people who see silver price being good value.

[Au79]

So the gold silver ratio has finally broken out of the line box. This animal is now out in the wild, free to roam anywhere. Guess we will just have to draw a new line box. 😁

[Caratacus]

Last night, at close of trading, price of gold went up over £8/oz in a minute,  with a pin spike, then dropped slightly after trading.

Silver also went up but without the pin spike.

Did one of the manipulators spill his coffee?

[DarkChameleon]

7 hours ago, Caratacus said:

Last night, at close of trading, price of gold went up over £8/oz in a minute,  with a pin spike, then dropped slightly after trading.

Silver also went up but without the pin spike.

Did one of the manipulators spill his coffee?

High frequency traders, they mess you up every time, if it's in the code it's bought n sold.

[Paul]

In comparison, if you are holding physical silver and gold, the GSR is much much smaller in 'real' terms

 

x1 'Best Value/Random' 1oz Gold Britannia from Bullion By Post = £1,026

x1 'Best Value/Random' 1oz Silver Britannia from Bullion By Post  inc VAT = £19.32

Actual  GSR 1 :  53.10 !!!

 

Current Spot Gold £976.54

Current Spot Silver : £11.42

GSR 1 :  85.51

 

Unless you are paper trading in high volumes or buying VAT free silver by the monster box, the GSR is really not that relevant for average Joe Public collectors/stackers here on forum

[DarkChameleon]

1 hour ago, Paul said:

In comparison, if you are holding physical silver and gold, the GSR is much much smaller in 'real' terms

 

x1 'Best Value/Random' 1oz Gold Britannia from Bullion By Post = £1,026

x1 'Best Value/Random' 1oz Silver Britannia from Bullion By Post  inc VAT = £19.32

Actual  GSR 1 :  53.10 !!!

 

Current Spot Gold £976.54

Current Spot Silver : £11.42

GSR 1 :  85.51

 

Unless you are paper trading in high volumes or buying VAT free silver by the monster box, the GSR is really not that relevant for average Joe Public collectors/stackers here on forum

The suppliers are pushing their prices up when silver prices drop...the dealers are having to pay more over spot the lower silver becomes...almost li,e the suppliers don't want to lose money on quick drops.