Today's Chart Du Jour revolves around: February Gold versus March Silver. Time to sell silver against our gold long?
(Dec. 21th. Feb Gold Close 391.30, March Silver Close 5.21).

Two days ago, when February Comex gold was trading 283.80, we suggested that the risk-reward of a long position was justified given the confluence of moving average support at $281 and the fact that the market had rallied smartly off of the 76.4% retracement level at $278. Now we are almost at our preliminary objective of $293.10.

Of interest, we closed just under the 40-day moving average today, and it will be important to see gold trade above this moving average (which currently stands at 291.60) sooner rather than later. Ideally, one would like to see 293.10 reached, and then have any retracement from there hold the 291.60 level.

One point of some concern to any metals bull is the dismal behavior of silver. The pattern pictured below appears far more like a continuation pattern to the downside as opposed to a healthy and bullish market. Perhaps the growing popularity of digital cameras is truly making its mark on silver this Christmas season. If anyone buys a new camera to place under the tree, it's far more likely to be a digital one now. A break of 5.1910 moving average support would suggest at least a "washout" of weak longs down into the 4.90's.

For those long gold with a desire to book out some profit, crossing it against a short position in silver could easily be a winner from here.

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