Last July I invited Gary from Biiwii.com to help us understand how to use ratio charts...properly! His first post can be found here, but I believe there were some missing examples and lessons. SO I asked Gary to come back and fill in the holes that I felt were missing, and more importantly, what our users felt was missing. Please enjoy the article, visit Gary's blog, and let the COMMENTS FLY!
In July of 2008 it was my pleasure to provide the INO Traders' Blog this look at ratio charts and the edge they can provide as they often tell a not readily apparent story regarding inter-market relationships.
Today, as we look at the market revival I have been calling Hope '09 and some ratios I consider of paramount importance, gold ratio charts are heavily in play.
The first chart I want to look at is the price of gold divided by units of the S&P 500.