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A look at the Gold and Silver Charts (08.02.2024)

The question that we are most commonly asked this year is: 

“There are wars all over the place, which are escalating and expanding. Why are gold and silver not reflecting this situation to the extent I feel they should?”

The gold silver ratio is an indicator of this. Silver has hardly moved at all, gold has gone to new highs then pulled back not reflecting the true risk or even perceived risk in the market.

Our best guess answer is that governments, particularly, are not finished buying the precious metals. They will ensure lower purchase prices until their quota is fulfilled. The setup of the market allows the prices to be controlled by the purchase and sale of paper contracts. The mines are basically price takers. An unenviable place to be.

The upside of this is that the physical metals are available at fire sale prices, particularly considering the currency printing and resultant devaluation. My favorite asset at present is silver, trading at less than half the price it did in 1980. I cannot think of another money/commodity half of the price it traded at forty four years ago.

When will the price tide change? I wish I knew. It has been a long wait. At least gold has touched new highs, but not in inflation adjusted terms. Price increases may be inevitable but Imminent? Who knows?

Physical metals have far outperformed the gold and silver stocks, which is usual in a depressed market. Stocks normally lever in the direction of the physical metals.

Prices, particularly of silver, look like a steal. We are seeing a situation now where, when the paper silver prices go too low, the premiums increase, showing us that in order to get stock into the market prices have to be higher.

The demand-supply situation in the silver market looks extremely lopsided, with demand far outstripping supply.

The silver to gold ratio at around 90:1 is distorted and should be in my opinion closer to 7 or 8 to 1.

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BITCOIN AND GOLD

I am still not convinced that Bitcoin will outperform gold at this juncture. The chart looks overbought and the run has hardly started. There are a few positive indicators, but the rate of change and stochastics are unconvincing.

The BTC v USD chart looks similar to the one below and a run higher at this point looks moot.

$BTCUSD:$GOLD Bitcoin to US dollar/Gold CRYPT 08 February 2024

Etherium is a buy. It has run a little but looks overbought. I don’t believe it will run over $2600.00 without a pull back.

$ETHUSD Ethereum to US Dollar 08February 2024
GOLD & SILVER STOCKS

Gold v HUI shows us that physical gold continues outperforming the stocks. Some indicators are overbought, but no transfer to stocks is indicated yet. It appears that by next week we may have a reversal, but not quite yet.

$GOLD:$HUI Gold- Continuous Contract (EOD) Gold Bugs Index - NYSE - 08 February 2024

Physical silver is a hold silver in preference to silver stocks. However some signals have turned negative.

$SILVER - SIL Silver- Continuous Contract (EOD) Global X Silver Miners ETF 07 February 2024

GOLD & SILVER

The silver-to-gold ratio is 90.30:1, still far too high in my opinion. Gold is still outperforming silver.

$GOLD:$SILVER Gold Continuous Contract - (EOD) Silver - continuous 08 February 2024

GOLD TO USD

Gold (the candlesticks) is being outperformed by the US dollar (green) as can be seen in the chart below.

$GOLD Gold - Continuous Contract (EOD) CME 08 February 2024

A LOOK AT THE GOLD AND SILVER CHARTS
TodayLast Week
Gold Price$2,030.00$2,034.00
Silver Price$22.49$22.63
Gold:Silver ratio90.30:189.72:1
Gold Miners bullish percent index32.1432.14
Dollar Index104.25103.59
Dow:Gold Ratio (BahaUS 38660.00 Gold price, $2,030.00)19.0418.77
Current USA inflation rate (Dept. of Statistics)4.1%3.4%

Gold’s low of the week was $2,014.00 and the high was $2,045.00, now trading at around $2,028.00.

  • The monthly chart for Gold  is a hold. I am still concerned with the spike high produced by the sharp increase in price in December, followed swiftly by the reversal.
  • The weekly chart remains a hold. The spike high still needs careful watching. The rate of change has gone negative.
  • The daily chart shows us a hold on gold.
$GOLD Gold - Continuous Contract (EOD) CME 08 February 2024

The low for Silver this week was $22.14 and the high $22.71, trading around $22.41 at present.

  • Silver on the monthly chart indicates out.
  • The weekly chart appears to be stabilizing. We are out.  Funds continue flowing into the metal. Under normal circumstances the price would be increasing. This is most perplexing
  • The daily chart remains out. Indicators are turning down again.
$SILVER Silver - Continuous Contract (EOD) CME 08February 2024

Our partner has stock of both gold, silver and Goldbacks in our vaults available in Panama. Please contact us for more information.

Goldback FortKobbeVaults Panama
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A video by Mike Adams on the Goldbacks. 

Well worth a look!

On the Stockcharts.com charts, the blue vertical lines are our proprietary system buy signals and the red vertical lines are system sell signals – for information purposes only

Please contact us to arrange the purchase and storage of your gold and silver requirements in a safe, insured location outside of your jurisdiction.

If you are interested in an overview of Fort Kobbe, you may want to have a look at this video:

Mike Brown, Director, Fort Kobbe, International Vaults, A DotCom Magazine Exclusive Interview

Larry Simon
Larry Simon

Larry Simon was educated at the University of Witwatersrand, Johannesburg, South Africa and is an experienced businessman specialised in management, investment and finance.

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