Silver Is Outperforming Gold And This Is Why That Matters For You

What you are looking at is a ratio chart created by taking the price of silver and dividing it by the price of gold. This creates a “relative strength” price plot that allows us to compare the price performance of silver to that of gold. When this goes up it means that silver is outperforming gold.

As you can see silver has been doing that on this new bull rally that began in the precious metals complex since the end of February.

As far as this month goes, it also did it on the upside when gold rallied in the first half of May and also performed better than gold last week when the metals complex dipped, after gold made an all time high by tapping on $2450.

This is important, because typically early in a metals bull market gold actually outperforms silver, and other precious metals, and then silver starts to outperform gold. When silver does that big cap and small cap mining stocks also start to do well, and the GDX mining stock ETF is outperforming gold too.

In 2020, after the shutdowns and market collapse that March, gold and silver exploded to the upside. However, there was a sizable decline in the metals and mining stocks in the 2nd and 3rd quarters of 2022. That decline was preceded with a quick drop in silver, as silver fell before gold really dropped. So, weakness in silver served as a warning of a coming overall correction in the metals complex.

The opposite is happening now.

The trend of silver outperforming gold is happening and it is real.