Gold Investment

As of 12:30PM CST

As of 12:30 PM CST

Gold US$650.80 (up)
Silver US$12.67 (up)
Oil US$71.37 (up)
DJIA 11,255.72 (up)

Gold to Oil Ratio: 9.118677315 (down)
Silver to Oil Ratio: 0.177525571 (down)
Gold to Silver Ratio: 51.36543015 (down)
DJIA to Gold Ratio: 17.2952059 (up)

Gold Futures:
Vol Int: 130,205 (up)
Buy: 24 (down)

Silver Futures:
Vol Int: 56,542 (down)
Buy: 96 (down)

Comparison Chart:

Comparison Opinion and Thoughts
I think looking at the history of comparison I’ve been charting is sort of interesting to me. Look at the barrel of goods line (the average of the composite prices in the chart). Notice how last week (May 11-May 18) we saw silver and gold swinging above the barrel of goods average, with oil and DJIA below it. The “corrections” swung them to opposing points — oil and DJIA are above the barrel of goods average, and gold and silver are below it. Disregarding real industrial or usage demand, is this something that we’ll see often due to the speculation side putting as much pressure on the price as anything?

If prices go way too high, we will see a real usage demand drop. If prices go too low, we’ll see usage demand increase. By accepting that most users will buy their normal supply numbers if neither of these extremes is true, is it possible that the prices are going to cycle up and down based on trying to equalize at what we could call the barrel of goods norm?

Would it be unwise to forecast that next week (short of any huge supply shortages or discoveries) that gold and silver might tick above the barrel of goods average, and oil and DJIA might fall below it, even if all move up or down in unison?

It’ll be interesting to watch.

Discuss this article at the gold investment forum.