Gold/Silver Ratio Update

On January 22nd, I posted a note titled "It's time to Keep an Eye on the Gold/Silver Ratio." At the end of January 23rd, the ratio finally closed below 50 (at 47.9) for the first time since 2016. 

This triggers a change from favoring silver to favoring gold. This status will continue until the next time the Gold/Silver Ratio closes a week above 80. The table below displays all periods since 1975 when the model favored silver, including the period ending January 23rd, 2026.

It is important to remember that the "strategy" presented in the original article is not necessarily intended to be used as a standalone trading system. It merely suggests whether gold or silver is expected to outperform. So to be clear, the cross by the Gold/Silver Ratio below 50:

• Does not mean that traders should immediately and automatically exit any long positions in silver and move only into gold
• Does mean that the strategy now favors gold over silver (each previous period of GSR moving from below 50 to above 80 has seen gold outperform silver significantly; see table below)

The table below displays gold and silver performance for previous periods when the GSR moved from below 50 to above 80.

From a trading perspective, the recent drop below 50 suggests that going forward, futures traders prefer gold futures or silver futures, and that ETF traders prefer GLD over SLV.