Gold Silver Ratio (GSR) has indicated for a few years now that silver looks undervalued compared to gold. It is often claimed that the actual ratio of these two physical elements in the earth’s crust is around 15 silver ounces for every 1 gold ounce, however price at the moment values 1 gold ounce as nearly 70 silver ounces!
Could this be about to change? Heres the chart.
GSR is currently jammed up near the top of its range however last year appeared to break down from the rising channel it had been in. Now it is in a wedge which shares some similarities with a wedge in 2010. That time silver went on a huge run, almost to new all time high and drove the GSR all the way to the bottom of this large channel. Could this be about to repeat? If so silver will have a very good year this year, and perhaps finally new all time high.
Long silver, short gold, (against each other).