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Monday, October 30, 2006

Gold Burst Through the US$600 Barrier Today

The GOLD PRICE burst through the US$600 barrier today but stopped short of 610. This honey's headed higher, at least to 618-620.

The SILVER PRICE did not confirm gold's breakout above resistance, but was turned back by 1223. Will probably break thru 1225 tomorrow, but stiff resistance rules through 1250, so progress will be slow.

DOW IN GOLD DOLLARS (Dow measured by gold) has once aghain been turned back in defeat from the $425-435 level. Dow still not very strong against gold (or silver).

US $ Index fiddled today, no resolution. A slip through 85.50 takes the dollar down.

Dow has the look of having turned down. Action Friday & Monday look like impulse wave dowm, but what do I know? I'm a stock bear, yet I know one thing: One day we will wake up and say, "Yesterday was the last day to swap stocks for silver & gold."

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Friday, October 27, 2006

If Gold Passes $620 It Should Fly

The GOLD PRICE has twice bounced off 600 since end-September without penetrating. Third time may be the charm, since the more times it hits, the greater the chance it will penetrate. Gold faces strong resistance just under 610, & even strong resistance tucked under 620. Ahh, but if the GOLD PRICE passes 620, it should fly. (Downside it must keep holding 588.80 and 560.)

Whooo-eee! The SILVER PRICE looks ready to take on the moon. Tomorrow silver must close above 1220 to maintain this momentum. Then it lands in heavy slogging resistance from 1220 to 1275. Above 1275 nothing much stands in the way of silver's view of the sky. If the Gold/Silver ratio falls through 49:1, it will fall a long, long ways further. Great news if you own silver.

The US DOLLAR INDEX fell for their third day straight. It may have ended today, but if not, watch out. Today it hit the 50 Day Moving Average. It should turn around at 85.50, but absolutely must hold 85 or break down and fall to 84.40 or lower. Some of those Nice Government Men better get up of their big, soft, $2,000 office chairs and start manipulating something. What's this world coming to? They just don't make bureaucrats like they used to.

If I owned stocks (surprise! I don't) the last four day's Dow chart would have me sweating & pondering. Looks like distribution to me, toppy. Out of the last 11 days, the Dow has closed up nine. How long? Long enough for y'all to sell stocks and buy silver & gold, I hope. Owch! Yesterday I forgot to return to the subject of the key reversal. Last night's closes, of course, confirmed it and boy! did it prove itself today in gold and silver.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Monday, October 23, 2006

The Gold Price May Put in One More Low

It's a fact of life about corrections that people begin to lose hope and begin wondering whether they were right in the first place. Poor old GOLD PRICE is getting kicked in the teeth hard every time it approaches US$600. The SILVER PRICE and the GOLD PRICE are somewhat out of synch right now. The way I read the charts, the SILVER PRICE has already made its bottom, and is building one of those long, narrow correction triangles that are its trademark.

The GOLD PRICE, on the other hand, may put in one more low. These are the times when your guts roil & you want to puke in the wastebasket just thinking about buying silver or gold. On the other hand, if you are right and you buy, these are the times you will tell your grandchildren (not to mention your brother-in-law) about the rest of your life. I'd buy more silver than gold. The GOLD/SILVER RATIO is fixing to make a huge slide.

The US Dollar jumped well today, to challenge once again 87.30 & its 200 DMA (87.07). It's hard making friends when you are as undependable as the dollar. What I believe the buck has done is trade out a long, narrow equilateral triangle based on last May's low at 83.66, up through 84.39. At the top it is bounded by 87.33 & 87.30. This should break out upside to challenge 91, but who would want to play it? Hurts too bad to be the dollar's friend.

Stocks today, y'all needn't remind me, rose through my 12,075 upper target. All I can say is, I warned y'all that the Dow could keep on rising into January. Nevertheless -- Nonetheless -- Notwithstanding, nothing has changed my mind about stocks. The rest of the bear market will be worse because of this divergence of 6 years between the Dow's final top and the other indices' tops. Therefore, SSFSAG (Swap stocks for silver & gold).

It deserves more than a passing notice that the Dow In Gold Dollars did NOT reach a new high along with the Dow, reflecting stocks' lack of strength against gold. The previous high at G$435.90 occurred on gold's last low, not on stock strength. Today it reached only G$432.08 (20.90 oz). Still to be seen is whether the DiG$ can reach the G$475 half way point. The longer it goes without reaching that point, the weaker the case for stocks.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Friday, October 20, 2006

Get Busy Buying Gold & Silver If You Want To Get On Board This Rocket

Here's the silver and gold price scorecard for the week:

12-Oct 20-Oct Change % change

Silver, cents/oz. 1129.5 1189 59.50 5.3%
Gold, dollars/oz. 576.30 593.00 16.70 2.9%
Gold/silver ratio 51.02 49.87 -1.15 -2.3%
Silver/gold ratio 0.01960 0.02005 0.00045 2.3%
Dow in Gold Dollars (DiG$) $ 428.13 $ 418.40 $ (9.73) -2.3%
Dow in gold ounces 20.71 20.24 -0.471 -2.3%
Dow in Silver Ounces 1,056.72 1,009.45 -47.265 -4.5%
Dow Industrials 11,935.61 12,002.37 66.760 0.6%
S&P500 1,359.62 1,368.60 8.98 0.7%
US dollar index 87.96 86.28 -1.68 -1.9%
Platinum 1,057.60 1,078.60 21.00 2.0%
Palladium 307.90 327.70 19.80 6.4%

Here's a riddle for the week, for all those know-it-alls who live in the world of theory rather than the real world: If silver and gold prices are supposed to move opposite to stocks, how come both metals and stocks rose this week? How come for much of the past year that the dollar and gold rose at the same time? Can you explain that? Can you tell me when the hind will calf? Right. My point is that humility goeth before success, and a constant willingness to check the facts & your premises. And sometimes, things that look good are in fact rotten, while things that look rotten are good.

Take stocks, for example. The Dow hit a new all-time high this week, crossing over 12,000. But obviously it has hit a wall. Now that's to be expected at such a monumental mark, but why aren't the other indices hitting new highs? Because also the Dow looks good, things are rotten for stocks, and this rally will play itself out in the first quarter of next year.

Meanwhile, SILVER AND GOLD PRICES look rotten, right? Well, until you look closer. Last week I guessed that they had bottomed and broken through long standing barriers at 1120 and 576. Today both metals dropped, but only after having challenged 1200 and 600 this week and cleared resistance at 1185 and 588. If they don't break out on this move, they will dip down once more and then break out.

Whichever occurs, you had better get busy buying gold and silver if you want to get on board this rocket.

As further proof, look at the DOW IN GOLD DOLLARS. Don't you find it intriguing, doesn't it pique your interest, that while the Dow reaches historic highs, it can't reach G$425 (20.56 oz) resistance against gold? No, it lost nearly G$10 (1/2 ounce) against gold.

Another reason why you should sell stocks and buy silver & gold. The US Dollar appeared to have broken out to the upside, then gave up everything this week and may have shot its hopes in the head today. If it cannot break through 87.30, then much lower prices await the buck.

A friend sent me a footnote to my diatribe & denunciation of IRAs & 401(k)s & such-like forced investment schemes that give you little choice to invest as you want. Into IRAs you can put Central Fund of Canada (CEF-NYSE) that owns a big pile of metal, 50% gold & 50% silver, outside the US. You can also buy the gold ETF, GLD, or silver ETF, SLV. And in some 401(k) & company investment plans you can buy precious metals mutual funds, or bear mutual funds that profit when stocks drop. You can also put physical precious metals into IRAs through Sterling Trust, (800) 955-3434, or American Church Trust, (800) 228-8825, using us or any other metals dealer as your broker. These means will help you sell stocks and buy silver & gold, even if you're trapped in an IRA, 401(k), or company plan.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Thursday, October 19, 2006

Will Silver and Gold Prices Run Away Right Now?

The last five days in the GOLD market have unfolded like a textbook classic: break through 588 resistance, run for 600 resistance, touchback to 588, mad leap through 600 resistance.

SILVER was just as good -- through 1150, stymied at 1185, touch back to support, then crash through 1185 to 1200. Now am I in a quandary, undecided whether silver and gold prices will run away right now to break through old highs at 1500 and 720, or whether they will touch back once more. I favour the latter. The silver price runs into more resistance at 1215, all the way to 1250. The gold price faces resistance at 600,610, and 618-620. A breakout would require a close above 635.

Oh. Oh. The Dow today rose over 12,000, but not as high as yesterday's 12,049, only to 12,027. And it closed over 12,000 as well. To me, this smells weak, but I'm a bear.

Of course, for those of you who are not, unfortunately, trapped in IRAs, etc. where you can't escape of the government plantation without paying a big tax penalty, this represents another opportunity for y'all to swap stocks for silver and gold. (Maybe I ought to just append the initials every day, to avoid repeating it: SSFSAG.)

Note carefully that the DOW IN GOLD DOLLARS, i.e., the Dow measured in gold, actually dropped on this historic day when the Dow valued in paper rose over 12,000.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Tuesday, October 17, 2006

Likely Strong Run Up in Gold, Followed by Downward Test Before Take Off!

The US DOLLAR INDEX chart looks rotten today. It has bounced
off the 87 - 87.30 ceiling thrice since mid-June. In fairness, 3 days ago
it hit the 200 Day Moving Average, so it is to be expected it would
ricochet. Still, it the buck can't climb above 87.30 soon, gravity will
take over.

STOCK market bulls are all bloviating about a new bull market,
but it's all bloviation. From whence will it launch, from P.E.s of 18
and yields of 1.6%? Not much foundation there, I trow. Flee stocks,
yes, sell them as soon as possible and buy silver and gold. Y'all will
look back on this as the opportunity of a couple of lifetimes.

Will the GOLD/SILVER RATIO rise again, or has it already seen
its high for this move? If you still hold gold you want to swap for
silver, do it whenever the ratio reaches 53:1, or miss it forever.

Here's the picture on the GOLD PRICE moving averages, all rising: 17 day at 584.32, 50 at 602.87, 200 at 599.51. What happened today? Gold simply
bounced off its 200 and 50 DMAs, and, more importantly, its top
channel line. Can it break through? I think so, for a test of 610, then
620. If it clears 625, it's running again. Beneath lies obvious support at
560. Most likely outcome seems to me a strong run up, followed by
one more downward test before it takes off. There's time to do all
that before end-November. Today, notice, that Gold fell back
to 588-ish resistance, but not through. I read that as strong.

Today the SILVER PRICE offered no surprise. It reached its 50 DMA (1173.92) and you can expect sellers clustered around that number. Still, it
stands above its other MA.s, which are all pointed up. Expect higher
prices and an attack on 1200 soon.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Further Support that Silver & Gold Have Bottomed

I am far, far too gracious (and modest) ever to employ those hated words, "I told you so." Therefore I will pass over in silence the repeated warnings you read somewhere that both silver and gold were liable to rise. (If any of you are interested the rhetorical device here is called praeteritio, to mention by listing as excluded. Your mother used it all the time.)

I went to Chattanooga, & gold and silver prices went berserk, on Friday. The GOLD PRICE jumped up through 575 resistance to 588.80, then closed today up another 5.90 to 594.70. What can I say? It is headed for 618 at least. The SILVER PRICE lagged not, neither did it fall behind. It closed on Friday up 30.3 cents at 1159.80, then rose another 23 cents to close today at 1182.80, on its way to 1200, perhaps even 1260.

All of this positive price action lends further support to the argument that silver & gold have already bottomed, although the jury will remain out until gold crosses 625 and silver 1250. Further downside is still possible, but not this week.

Here's one to tuck away in your mind permanently: in a bull market, always buy corrections. In a bear market, always sell rallies.

Against my expectation last Thursday, the Dow has not managed to pierce, or even touch, 12,000. If it does, it will burst upward briefly. It's inability to pierce 12,000 so far doesn't really say much. Even if it has strength enough to pierce it, resistance that psychologically huge would take some work to conquer. So the Dow's failure here could mean inward weakness (my interpretation) or it could amount to nothing more than condign hesitation at so large a barrier. I search the commentators to find some argument to gainsay my conclusions, but end up always thinking the same: swap stocks for silver & gold because this is your last chance.

The US DOLLAR INDEX hit its 200 DMA at 87.15 and crumpled. If it can recover quickly and climb quickly over 87 once again, then it has a shot for higher prices. Otherwise [make a slicing motion across your throat with your thumb].

The GOLD/SILVER RATIO isn't helping swappers. If it rises to 53:1, swap any remaining gold to silver. The DOW IN GOLD DOLLARS has not been awed by the strong Dow, but rather sank again today to G$416.45 (20.15 oz). It may not make the 50% fulcrum at G$473 after all, meaning stocks are even weaker than I think.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Thursday, October 12, 2006

Both Gold and Silver Turned Up This Week

One rose doth not a summer make, nor doth one week a change of trend.

However, both the SILVER PRICE and GOLD PRICE turned up this week, and with more significance than might appear on the face of it. With today's gold price close, both metals have climbed above resistance that has imprisoned them so far during this move, 1120 and 575. If they can hold above these levels tomorrow, then there's another argument in favour of a bottom having already occurred. Meanwhile, the silver price needs to close over 1220 and gold over 680 to confirm a trend change (by the time that happens, your chance to buy cheap will be a long-gone, wistful memory). We may see further downside in both metals before the end of November, as low as 525 and 1000. But for now silver's support at 1075 and gold's support at 560 are holding.

The US DOLLAR broke out over 86 this week and in 4 days ran to 87.20. Shorts were complacent. It should race now for 91.

The DOW JONES INDUSTRIALS AVERAGE, it seems obvious, will hit 12,000, probably later today or tomorrow. This will occasion great shouting, bragging, and chest thumping amongst those who sell stocks -- and well it ought to. If you had an occasion like that to shuck your dying investment off onto the sucker public, wouldn't you take it? Be wary, and look: new highs in the Dow do not take the DOW IN GOLD DOLLARS to new highs. Interesting. The highest the DiG$ might reach is (from my viewpoint) G$475 (22.98 oz.). Swap stocks for silver and gold. Do yourself a favour.

One of the best arguments favouring silver and gold right now is the generally negative sentiment. Combine that with today's positive price action, and you've got a great place to buy. Remember that corrections must progress through price, time, and sentiment. The first two have pretty well been satisfied, and now sentiment must reach a low before the market can turnaround. Therefore, when you here gurus talking about the end of the commodity bull market and a stronger dollar and other pie-in-the-sky ideas, just ask yourself one question: is the US government about to stop inflating the dollar?

If the answer is yes, then sell your silver & gold and buy stocks & bonds. If the answer is "Not a snowball's chance in Hades, unless of course three asteroids hit Washington, DC simultaneously", then swap stocks for silver and gold, stop your ears, and sit tight.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Thursday, October 05, 2006

Gold Price Fell Down to Support at 560

My, O, my, the DOW IN GOLD DOLLARS broke out to the upside of a bearish rising wedge. It blew through the previous G$415 (20.07 troy ounce) high and closed at G$435.90 (21.09 oz), whizzing past the G$425 (20.56 oz.) resistance area I had expected would stop it.

What does it mean? It could be the flow-out top of the wedge, and if so will collapse in the next day or so. Or, it could run to the next resistance at G$446 (21.58 oz) to G$454 (21.96 oz), or it could even run all the way to G$475 (22.98 oz.). What does that imply for the gold price? If the Dow went to 12,000, a DiG$ of G$475 implies a gold price of US$522.24. I'm not saying I expect to see that price, only letting you know what the outside of the range is. Speaking whereof, if the Dow exceeds its old high by 3%, that implies a top of 12,075 (3% being the amount it could exceed that old high and remain in the realm of meaning- lessness). Since the Dow has exceeded its old high, we have to reckon with that. However, nothing has altered my sarcasm of recent days, as all this is like watching the farewell tennis game for a 60 year old Pancho Gonzalez. It may be amazing that he can play so well, but he's 60 and he's not coming back.

The GOLD PRICE fell down to support at 560.00 where all sorts of buyers came roaring out of the woodwork. There was good solid physical buying and in the aftermarket gold rose 4.80, which by itself would have been a good day's work most days. If 560 support breaks, you can expect a drop to 540 - 542. Yes, it's scary and roils your stomach (Where's that wastebasket? I need to puke!) but times like this separate successful investors from the unsuccessful investors. Can you choke down some Pepto-Bismol and buy, or will you cave?

The SILVER PRICE behaved very well, posting a 10.53 low but not staying there any time. Most of the day was spent above 1075, which, if you will cast your mind back a few weeks, was where it stopped last time. Yes, it could drop further, but today could just as well prove to be the bottom. Beneath this targets are 1040, the last intraday low, and the round number 1000. I would certainly buy some here.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.



Tuesday, October 03, 2006

Buy Gold and Silver Now

Today the Dow Jones Industrial Average made a new all time high, but if you think that leaves me sitting in sackcloth & ashes with my palm over my mouth, you're wrong. It leaves me choking on laughter instead. The Dow makes a new all-time high -- on declining volume.

Meanwhile, the Dow Transports are stuck below 4500 and their 200 Day Moving Average, the S&P 500 is 13% below all time highs, and other stock indices lie even further below all time highs. Add to that a fatal rising wedge on the chart, & a broadening top, and you have the recipe for an enormous & sudden fall. Oh, it may not happen tomorrow, and the Dow might press ahead another 2 or 3% from here, but the outcome is sure, and the forecast is certain. This is a bear trap, set most likely by the Bears Little Elves, the Nice Government Men trying to assure election victory for the administration. Beware, beware, and take this golden opportunity to swap stocks for silver & gold.

The GOLD PRICE dropped today US$21.40, then dropped another 1.60 in the aftermarket. It gapped down on the open, and that set off all sorts of technical alarms as it collapsed through one set of stop loss orders after another to find its footing again at the 575 resistance level.

The SILVER PRICE followed gold down, falling even further percentage-wise, to close at 1095.50, below the crucial 1100 level, and then dropped another 11 cents in the after market to wind up at 1084.

If you're listening for me to sing "Woe is me" you'll be waiting a long time. Isn't this what I have been looking for? Now will silver & gold stop at these previous strong support levels, and post a double bottom, or will they drop a little further for new lows? I don't know. Tomorrow they might make another of those V-bottoms, spiking down during the day then closing higher or unchanged. This is what we have been waiting for, this is our opportunity. Do NOT go to sleep at the switch now. Buy Gold and Silver, and if they drop further, buy more. Put two-thirds in silver and one-third into gold.

The GOLD/SILVER RATIO rose today, predictably, but not high enough to trigger our swap. I've been waiting for 55. Keep watching.

The US DOLLAR made another meaningless move. Until it breaks 86 upside or 85 downside, it's just a tale told by an idiot. Come to think of it, it's that all the time.

Argentum et aurum comparenda sunt --
-- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
http://The-Moneychanger.com

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.