Medium term
Trade view / 08 February 2018 at 8:53 GMT

Macro Monday Tactical Book: Short gold vs long silver — #SaxoStrats

Global Macro Strategist / Saxo Bank Group - Singapore Hub
Instrument: XAUXAG
Price target: 76.08
Market price: 80.4908


Gold has vastly outperformed silver over the past five years as can be seen by the ratio in the weekly chart. We're getting close to potential resistance levels and reversal in gold vs. silver. 

We're therefore shorting gold and buying silver on spot for an entry level of 80.4908, risking 100 basis points with a stop at 84.20 and a target of 76.08. This trade could take one to three quarters to play out, yet, given over-extension, some drastic mean reversion could occur in the next two to four months.

Management and risk description

Risking 100bps.
The key risk here could be the momentum in the outperformance of silver over gold in the current cycle (since 2008). So far in 2018, price action and long positioning have been a lot more beneficial to gold than to silver.

gold and silver
 Source: Bloomberg


Entry:  Entry ratio of 80.4908
Short gold at 1312 
Long silver at 16.30  

Stop: 84.20

Target: 76.08

Time horizon:  3–9 months

You can trade the XAUXAG ratio on SaxoTraderGO 

— Edited by Clare MacCarthy

Non-independent investment research disclaimer applies. Read more

A compiled overview of Trade Views provided on is found here


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail