By Elliott Wave International
Silver is living up to its reputation for volatility as the new year begins.
Silver’s one-month implied volatility has surged, a development that has historically coincided with important highs and lows in the metal’s price. Since 2020, similar volatility spikes have tended to appear near key turning points rather than during quiet, trending phases.
At the same time, the silver/gold ratio has also jumped, showing that silver began outperforming gold late in last year’s rally. In past cycles, sharp advances in this ratio have often accompanied tops in silver prices.
What makes the current setup notable is the interaction between these two measures. Spikes in volatility have frequently aligned with turning points in the silver/gold ratio, while spikes in the ratio itself have tended to appear near major price peaks.
Will history repeat once again — or is this rally still unfolding? Elliott wave analysis helps place these extremes into a broader market context and assess what typically comes next when conditions look like this.
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