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I post this chart from time to time. It's the long term ratio of Nasdaq to silver. $COMPQ / $SILVER at http://stockcharts.com . It's very trendy and already 33% off the highs made earlier in 2020. It closed solidly below most short and medium term moving averages.
Here's a zoomed in view of recent years which I believe are showing a major top transforming into a long term down trend for the Nasdaq to silver ratio.
3/ Some of my conclusions:
* not long term bullish for stocks
* dip buying strategies for gold and silver, not stocks
* Trump is a weak-dollar president and likely to exacerbate this trend
* a rising interest rate cycle is what I'm watching for to reverse this trend (years away)
* not long term bullish for stocks
* dip buying strategies for gold and silver, not stocks
* Trump is a weak-dollar president and likely to exacerbate this trend
* a rising interest rate cycle is what I'm watching for to reverse this trend (years away)
4/ I'm not worried about paper vs physical debates. We're a long way off from that being a problem. The most likely cause for paper to stop being traded for physical is the US losing a world war scenario and being straight up conquered and dismantled. Today this is unthinkable.
5/ I suspect the best way to benefit personally from a downtrend in the nasdaq to silver ratio is with deep out of the money long dated bull call spreads on $SLV and $VXX. For $VXX, being very tactical and only trading "in season" will be important.
