Gold Vs SilverOilDowBarrick

Gold Vs Silver/Oil/Dow/Barrick

Spot Gold price has been resilient since touching a low of $1451 an ounce in March. We are going to compare Gold with other assets on a Long-Term Horizon.

On a Weekly Chart, Spot Gold keeps trading above the ascending 20-week moving average.

Technical indicators, including 20-week, 50-week moving averages and relative strength index, are so well directed as to maintain long-term bullishness for the yellow metal.

A continued rally should let Gold price encounter Upside Resistance at $1885 and $1950 (61.80% Fibonacci extrapolation from March low).

Long-term Key Support is located at $1610.

Spot Gold: Weekly Chart

Source: GAIN Capital, TradingView

Now, let's look at the popular Gold-Silver Ratio. Effectively, the Gold-Silver Ratio represents the number of ounces of Silver that could be bought by a single ounce of Gold.

On a Weekly Chart, the Gold-Silver Ratio is rebounding from a recent low at 94.85 seen earlier in June.

In case investors agree to a bullish bias in the Gold-Silver Ratio, they should expect one ounce of Gold to be able to buy increasing ounces of Silver going forward. Their corresponding trade (now) would therefore be exchanging (or selling) silver for more ounces of gold.

Gold-Silver Ratio: Weekly Chart

Source: GAIN Capital, TradingView

In fact, over a 3-year period (from June 2017), Gold (+37.26%) has been outperforming Silver (+0.88%), and the trend seems not to change readily.

Gold vs Silver: Performance Chart

Source: GAIN Capital, TradingView

Crude Oil price, during a 3-year period, has seen higher volatility than Gold.

Still remember Crude Oil futures prices sank into negative territory in April?

As compared to Crude Oil (-14.54%), Gold (+37.26%) excels in its power of generating stable growth.

Gold vs Crude Oil: Performance Chart

Source: GAIN Capital, TradingView

How is Gold compared to the general U.S. stock market?

For the most part of the three years under review, the U.S. Dow Jones Industrial Average outperformed Gold...until the severe impacts of the coronavirus pandemic showed up in the later part of February.

Though we can see that the general stock market's 3-year performance (+22.72%) is currently catching up with Gold's (+37.26%), Gold really shone as a safe-haven asset during the market distress in February-March.

Gold vs Dow Jones Industrial Average: Performance Chart

Source: GAIN Capital, TradingView

However, when compared with Barrick Gold Corp (NYSE: GOLD), a gold miner stock, Gold become lacklustre.

Barrick has been out-performing Gold only after rebounding from the March low. Investors must have bought the gold miner stock in anticipation of rallying gold prices.

Currently the stock has entered a consolidation period, but still it fares better than Gold on a 3-year horizon (+57.10% vs +37.26%).

S&P Global Ratings has just raised its outlook on Barrick to "Positive" from "Stable", citing the Company's "materially strengthened" balance sheet.

Barrick is the only asset under our review today that can beat Gold!.

Gold vs Barrick Gold Corp: Performance Chart

Source: GAIN Capital, TradingView

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.