✓ Entry price: 12.62 ✘ Exit price: 27.25 ▲ Theoretical gain: 115.95%
The broad dollar weakness of 2020 provided an ideal scenario to leverage precious metals. In March, we flagged the RSI on the gold/silver ratio was back to 55-year highs and suggested we enter one of our favorite trades. In May we watched the outperformance of silver vs gold, feeding our narrative of economic recovery and a move towards “value”.
In August we called the exit, advocating taking partial profit on longs at 27.25.
What Happened Next?
From August 18th to September 18th, 2020, Silver dropped 3.2% from our exit price, supporting our views on the long trade’s timing.