Most of the attention is being given to gold, rather than silver, and that is understandable, Eric. The squeeze in physical metal is mainly happening in gold so far, which as we speak is still in backwardation. This backwardation is remarkable given gold’s price advance. It shows that holders of physical gold have not been sufficiently enticed to sell and hold dollars or some other national currency instead. It is a sign that gold remains firmly in strong hands, and these gold owners see gold’s upside potential.
Even though gold is stealing the show so far this year, do not overlook silver. It looks ready to catch up. The gold/silver ratio peaked above 65 at the end of January, and has been gently declining since then. It is now under 64. When silver huddles above resistance around $20.25 to $20.40, its upside advance will likely gain some momentum, resulting in silver’s outperformance and an accelerating decline in the gold/silver ratio.
- James Turk via a recent King World News interview, read more here: