LIVE MARKETS-Silver has been white hot; maybe too hot?

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SILVER HAS BEEN WHITE HOT; MAYBE TOO HOT?

Gold prices extended losses from the previous session on Friday, as stronger-than-expected U.S. economic data and easing geopolitical tensions in Iran hampered bullion's bullish momentum.

Meanwhile, traders continue to eye the extent of silver's XAG= striking outperformance vs. gold XAU=.

Indeed, last year, silver rocketed more than 145% vs. a 64% rise for gold. So far in 2026, silver is jumping more than 20% vs a 6% gold gain.

With this, the gold/silver ratio plunged from a 104.70 close on April 21, 2025 to a low of 49.81 on Wednesday of this week. The ratio is clawing its way back over 50 on Friday.

Meanwhile, of note, the speed and extent of the ratio's decline has driven it substantially below its 200-day moving average (DMA).

In fact, on Wednesday, the ratio ended at an all time low, which was 41.8% below the value of this closely followed long-term moving average.

Since the early 1980s, and prior to this year, the ratio's disparity vs. its 200-DMA put in three major lows less than -36%: in 1987, 1998, and 2011.

Although there were only three major lows over this time, a violent upside reversal in the ratio may well signal a major low in it, and therefore, an end to silver's dominance relative to gold.

How such a turn would translate to the behavior of precious metals miners is a bit less clear. Subsequent to the 1987, 1998, and 2011 troughs, the Philadelphia Gold/Silver Index .XAU, on average, fell about 7% over the next 30 trading days. It was, on average, up 2.6% over the next 90 trading days, but lost, on average, 9.2% over the next 180 trading days.

(Terence Gabriel)

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