Gold Vs Silver/Oil/Dow/Barrick

Spot Gold price has been resilient since touching a low of $1451 an ounce in March. We are going to compare Gold with other assets on a long-term horizon...

Gold 5

Spot Gold price has been resilient since touching a low of $1451 an ounce in March. We are going to compare Gold with other assets on a Long-Term Horizon.

On a Weekly Chart, Spot Gold keeps trading above the ascending 20-week moving average.

Technical indicators, including 20-week, 50-week moving averages and relative strength index, are so well directed as to maintain long-term bullishness for the yellow metal.

A continued rally should let Gold price encounter Upside Resistance at $1885 and $1950 (61.80% Fibonacci extrapolation from March low).

Long-term Key Support is located at $1610.

Spot Gold: Weekly Chart

Source: GAIN Capital, TradingView

Now, let's look at the popular Gold-Silver Ratio. Effectively, the Gold-Silver Ratio represents the number of ounces of Silver that could be bought by a single ounce of Gold. 

On a Weekly Chart, the Gold-Silver Ratio is rebounding from a recent low at 94.85 seen earlier in June. 

In case investors agree to a bullish bias in the Gold-Silver Ratio, they should expect one ounce of Gold to be able to buy increasing ounces of Silver going forward. Their corresponding trade (now) would therefore be exchanging (or selling) silver for more ounces of gold. 

Gold-Silver Ratio: Weekly Chart

Source: GAIN Capital, TradingView

In fact, over a 3-year period (from June 2017), Gold (+37.26%) has been outperforming Silver (+0.88%), and the trend seems not to change readily.

Gold vs Silver: Performance Chart

Source: GAIN Capital, TradingView

Crude Oil price, during a 3-year period, has seen higher volatility than Gold.

Still remember Crude Oil futures prices sank into negative territory in April?

As compared to Crude Oil (-14.54%), Gold (+37.26%) excels in its power of generating stable growth.

Gold vs Crude Oil: Performance Chart

Source: GAIN Capital, TradingView

How is Gold compared to the general U.S. stock market?

For the most part of the three years under review, the U.S. Dow Jones Industrial Average outperformed Gold...until the severe impacts of the coronavirus pandemic showed up in the later part of February.

Though we can see that the general stock market's 3-year performance (+22.72%) is currently catching up with Gold's (+37.26%), Gold really shone as a safe-haven asset during the market distress in February-March.

Gold vs Dow Jones Industrial Average: Performance Chart

Source: GAIN Capital, TradingView

However, when compared with Barrick Gold Corp (NYSE: GOLD), a gold miner stock, Gold become lacklustre.

Barrick has been out-performing Gold only after rebounding from the March low. Investors must have bought the gold miner stock in anticipation of rallying gold prices.

Currently the stock has entered a consolidation period, but still it fares better than Gold on a 3-year horizon (+57.10% vs +37.26%).

S&P Global Ratings has just raised its outlook on Barrick to "Positive" from "Stable", citing the Company's "materially strengthened" balance sheet.

Barrick is the only asset under our review today that can beat Gold!.

Gold vs Barrick Gold Corp: Performance Chart

Source: GAIN Capital, TradingView

More from Gold

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