Signs of improvement - silver and crude

Since last August, both silver and crude have been tightly correlated to SPX, with all three instruments being synchronized in the timing of their highs and lows. And while the heights of their respective highs and lows varied, the directions of their moves remain correlated. Silver and SPX, in particular, have been strongly correlated.

Below is a Stockcharts chart with silver and SPX in the top panel, crude ($WTIC) and SPX in the second panel, and silver and crude in the third panel. Note how the intermediate lows of the three instruments are synchronized, with silver's 52 week low being put in at the end of October, SPX's low on Nov 21st, and crude's low in late December.

Last week, silver managed to put in a lower high, and this past week, the metal put in a higher high, bullish signs that the uptrend will continue. This is in contrast to SPX, which was down on the week.

Crude, while not as strong as silver, managed a higher low before closing up for the week.

Given the past correlation to equities, these are bullish signs that stocks will rise.