Gold and commodity ratios must be recognized for clear buy and sell signs.

When trading commodities, particularily gold, I like to look at how many units of one commodity I can buy for an ounce of gold. Consider when oil was $150 a barrel, you could get about 7 barrels of oil for one ounce of gold. Historically, when you see this ratio in single digits it is time to sell oil and buy gold. The alternative is happening today, when you can buy 25 barrels of oil for 1 ounce of gold, it historically means oil is too cheap and must be bought while gold must be sold. This principle works well for silver and natural gas as well. With the silver ratio anytime over 65 ounces to buy one ounce of gold becomes a strong buy, with the gold being a sell. Natural gas becomes a huge buy when you can get 150 mcf or better units of gas for every ounce of gold, it becomes a sell at 70 times or lower. Explore some comparison charts on these commodities and the data you will find supports the conclusions.