Recent commentaries

In our previous essay we've covered the situation on the gold market, however since rallies (and declines) often correspond to the rallies (and declines) in the mining stocks, this time we will focus on the latter and check if we can spot any divergences or confirmations.

Investors are struggling to deal with ballooning US Treasury yields which are supporting the dollar. The rise in yields acts as a stabilizer but there are inflation concerns. As Treasury rates rise, the dollar becomes more appealing to investors. This could damp the prices in dollar-denominated commodities such as silver and gold - will it, or will the precious metals manage to rise despite USD rally as they did in the past month?

Last week the Chinese approved the country's first gold fund designed to invest in overseas listed gold ETFs. This year many Chinese investors added gold to their portfolio and at the Shanghai Gold Exchange, trading volume rose 43% to 5,014 tons in the first 10 months of 2010. This bullish fundamental factor has been reflected in one of the gold charts that we've prepared for you this week, which also supports the bullish case for the metals. However, will the rally take place right away?

The gold-silver ratio is perhaps one of the first indicators traders looked at to comprehend the state of the precious metals market and accordingly acquire positions. We attempt to revisit the gold silver ratio in a new light to arm our investors with the right view. The gold silver ratio is not outdated; the view needs to be refreshed. Over the course of this essay, we will establish the rules of mean reversion and understand how pairs and ratio work.

European structural problems and tensions in the Korean Penisula have contributed to the upswing in the prices of precious metals. Meanwhile, the decline in euro appears overdone on a short-term basis. Got gold?