Silver USdollar and Gold/Silver ratio risk position 16 July
Silver Price Forecast relative to Long Term Monthly - Medium Term Weekly - Short Term Daily - and Hourly (not shown) data.
SILVER FORECAST(Previous upodate in brackets)
|Trend||↓ (↓)||↓ (↓)||↓ (↑)|
|% Risk Weight||77 (78)||40 (43)||45 (48)|
|PM Distribution Total allocation 50% (35%)||Pt:35%||Ag:30%||Au:35%|
16 July 2021 close: Weak performance at the end of the past week is disappointing but not unexpected. It has been part of the metals story for 10 years. We need yet to witness a strong market with weakening momentum to even start thinking about a change of the long term trend that started in March 2020. On the quarterly chart we should generally expect to see a higher risk weight level before a possible early turn signal. No Change.
14 July 2021 close: The wedge that is developing since early 2020 may theoretically last for another year, although unlikely. The pattern is more likely to develop a strong breakout to the upside where our still lasting target of 37.00 comes into play. A price average of the set of corrections experienced in 2012. No Change to a strong hold. An early break of nearby chart resistance of 28.53 could trigger a larger allocation to silver. This also depends on the still uncertain short term gold/silver ratio outlook. No Change.
02 July 2021 close: At the start of this third 2021 quarter The Silver quarterly chart still looks strong. The Monthly chart develops into the narrowing consolidation preparing for the next move which is expected to move up as major trend changes never come with a single move of the same in one direction of the same degree. The 155% increase seen during that first move which lasted 6 months, is a signal that there's more to come. And although silver looks potentially more attractive than the other metals at this moment, there is yet to develop technical evidence for silver to become a WallStreetBets style asset. The Gold Silver ratio is still not in a position to confirm that Silver break out. Thus from a pure risk perspective we would not look to apply a higher allocation to silver. If that break comes or is signalled in advance there is plenty opportunity left in the bag. No Change to our near 1/3rd allocation.
GOLD/SILVER Ratio Price Risk Analysis
(Previous update in brackets)
|Trend||↑ (↑)||↑ (↑)||↑ (↑)|
|13 (12)||65 (64)||89 (80)|
Total allocation 50% (35%)
Gold Silver ratio analysis
16 July 2021 close: This week's close put the price in middle of a one year range. The long term outlook remains in favor of silver but the trigger to increase the silver allocation hasnt come yet. No Change.
14 July 2021 close: The Gold Silver ratio still doesnt provided a clear signal in either direction. All risk time frames are showing some upward momentum whilst monthly has been sitting in a low risk percentage level for 5 months now whilst not being decisive. The latter means silver is likely to make that long expected move, but it may take many more months to materialize. Long term risk weight has not yet developed a proper bottom. This confirms the long term silver hold and a near equal precious metals distribution.
During a few weeks of holiday we will not update the Platinum Silver ratio. Suffice to say Platinum still looks firm longer term and now also shorter term. PT remains an approximate 35% hold within the large PM allocation. No Change.
02 July 2021 close: At the start of July the interim reading is still an uptrend and not particularly conclusive. Weekly trend actually turned up on a pivot whilst the length of the consolidation in the Gold/Silver ratio is still extending. This makes it hard to consider a significant opportunity although the weight of that opportunity looks to be in favor of Silver. Interim Quarterly risk weight (chart below) ticked up but cannot be used for up/down confirmation. We still think that quarterly risk weight will drop into the 5-10% zone and this can still be 6 or 9 months away. Thus, stay put and wait. No Change.
16 July 2021 close: Shallow price movement with a sharpish risk weight move rarely offers strong indication like in this case. It means that Platinum or Silver may suffer a bit more in coming days. No reason for any allocation adjustment.
02 July 2021 close: The sizeable drop in risk weight will either lead to bullish divergence (in favor of PT) coupled with a with a fresh ratio low where silver is stronger than platinum, or the ratio will turn up together with risk weight and finish what it started one year ago. Reason to stay on the sidelines and maintain the existing allocation.
16 July 2021 close: The weekly timescale print at this week's close leans towards a higher Platinum/Silver ratio, although the current consolidation may require a bullish divergence developing with a lower intermediate platinum/silver weekly close. This may be a few weeks out.
02 July 2021 close: Weekly develops a similar pattern as Daily where a lower ratio may develop bullish divergence in 4 to 6 weeks time or Risk weight can turn up decisively pushing Platinum higher again. Again no reason to seek additional opportunity beyond our current allocation of around 35% of total precious metals.
16 July 2021 close: The interim monthly reading cannot be used for allocation analysis during a relative period of price consolidation. This monthly timescale being in interim risk weight downtrend may slightly favor silver but no reason to change allocation.
02 July 2021 close: Monthly risk has turned down again at the start of the new month and also looks it may develop bullish divergence. From a price risk perspective, Platinum is still so close to its all time lows versus Silver and so far away from historic equilibrium holding the position and distribution is more likely to be the best and most profitable choice longer term, unless time overrides it with fresh opportunity.
25 June 2021 We are closing in on Month end which will be reported on next week with a view of the new July forward looking risk weight position. With Monthly risk weight now at 48% we would expect to see a much higher percentage risk once this market peaks.
16 July 2021 close: As we just started this quarter we maintain that strong bullish divergence 2 quarters closing price ago is the dominant reading. It is way too early to trust this interim downtrend as a primary signal as the move in the Platinum/Silver ratio thusfar has been too limited.
02 July 2021 close: The current downtrend is a very interim type reading on this long term chart, whilst the extreme bullish divergence, not seen before, earlier in the first half of 2021 cannot yet be dismissed as being false. This again means no change and patience to see this market develop in favor of our current allocation. Worst case scenario is that one of the metals strongly outperforms the others, but still drags the others along.