Friday, November 11, 2011

Updating the gold-silver ratio proxy

GLD-SLV is still above the Bull Flag breakout, but markets would have us believe it is party time.  Who do we believe, our eyes, ears and common sense or a hopped up, black box driven electronic carnival? 

Seriously, I would lean against eyes, ears and right minded common sense where this market is concerned.  Conviction is a sure way to get killed in a market like this.  So the GSR is not broken and it remains a bearish divergence to the relief rally.  But if the bulls do take it down and greed reasserts, the limit to the fun is likely the green shaded zone.

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