Tuesday, March 4, 2008

Gold Mining Shares vs. Gold Bullion Ratio

Here's a 3 year chart of the of the Canadian Mining shares vs. Gold. Its been in free fall the past 2 years but there are signs that a major trend change is underway
  • Notice the positive divergence between the ratio itself and the RSI-7 and MACD.
  • The ratio has broken upwards from its year long down-trend.
  • The 50 MA having remained below the 200 MA for almost one year looks to turn upwards ready to cross back above.
This could portend the much anticipated rise of the mining shares against the metal which has hurt gold bugs the past 2 years, especially in the JR Mining space.

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