52-to-1 Just Right for the Gold/Silver Ratio?
Source: Brad Zigler, Seeking Alpha (5/27/08)
With all the market tumult recently, it's nice to be able to count on something constant. The gold/silver ratio isn't immutable, but it's been mighty steady while metals prices have been roiling.
Follow-through on Wednesday's gold rally was cut short by profit-taking on Thursday. After making fresh short-term highs in the morning floor session, June COMEX futures sold off, ending the day $10 lower. Traders cashed in a few chips after seeing the crude oil marketbackfill $4 a barrel and the U.S. dollar strengthen.
Thursday's price action was an inside day, though, which leaves room for the bulls to take prices higher.
For the week, June gold moved up more than $38 an ounce, or 4.3%, and gold mining stocks went along for the ride. The 16-stock Philadelphia Stock Exchange Gold/Silver Index's (PHLX: XAU) weekly 3.8% gain was trumped by a 4.2% surge in the broader American Stock Exchange Gold Miners Index (AMEX: GDM). The Market Vectors Gold Miners ETF (AMEX: GDX), which tracks GDM, also gained 4.2% for the week.