$Gold/$Silver Weekly

A reasonable fascsimile of the decline in margin debt since last February has to be the rise of the gold/silver ratio. It happens to be only a few points away from a breakout, where it could rise to the point of 70-80X the silver price.

That would indicate a $U.S. dollar gold price in the range of $1400US - $1600US. should that occur. That would also indicate that markets are set to decline, while gold prices rise.

Silver prices would have to rise spectacularily, or gold prices would have to crash spectacularily for gold prices to remain where they are relative to silver in this scheme, so I believe that silver prices will remain in the penalty box.

It really depends a great deal on the direction of treasury bill rates, as they are close to zero and can see negative nominal rates. Its for this reason alone that you can say that the powers that be are hammering the gold price. Secondary to this may be the Indian elections, which may result in the lifting of import restrictions, where you have the exit polls on the 12th of May.

http://scharts.co/1bZ1HW5

-F6