The Gold-to-Silver Ratio (GSR) is a simple and compelling measure
The Gold-to-Silver Ratio (GSR) is a simple and compelling measure: Tom Essaye Quoted in Investing.com
Are silver prices set for a breakout?
Silver may be setting up for a breakout, according to Sevens Report’s Tom Essaye, who highlights a rare divergence between gold and silver pricing that could soon correct in favor of the latter.
“The Gold-to-Silver Ratio (GSR) is a simple and compelling measure with historical significance. It tells you how many ounces of silver it takes to buy one ounce of gold. Today, that number is around 100:1,” Essaye said in a Thursday report.
Essaye emphasizes that silver is increasingly seen as the “people’s gold,” while also benefiting from strong industrial drivers.
Demand is growing “due to electric vehicles, which use more silver than traditional cars.” Moreover, Essaye highlights solar panels, one of the fastest-growing sources of silver demand, electronics, 5G technology, medical devices, and defense systems.
Even with these tailwinds, silver prices have yet to revisit their 2011 highs near $50. “Silver hasn’t even returned close to its all-time high of $49.95 during this current precious metals’ bull run,” Essaye said.
“Typically, it runs between 40:1 and 60:1, and it doesn’t get above 100 very often,” he added.
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