Wednesday, June 20, 2007

Silver & Gold Have Nothing to be Proud About Today

SILVER & GOLD have nothing to be proud about today. Theirs was just a miserable performance, & they've dropped more in the aftermarket. Silver's 200 day moving average is only 20 cents below it at 1299; gold's is at 641.90. Silver's momentum indicators look ready to roll over. Today showed a lack of conviction, or some heavy selling by somebody. Both look ready to retreat once again tomorrow.

STOCKS didn't exactly shine today, either. The Dow dropped (as of this writing before the close) 86.98 and the S&P proportionally more at 13.84. (Wait, wait. In the last 30 minutes of the market day, while I was writing this, the Dow dropped another 64.54 points for a total 151.52 for the day, and the S&P dropped a total of 21.12 points. That brings the closing Dow in Gold Dollars down to G4424.84, a break below G$425 support. Stocks are looking weaker & weaker against gold.

The US DOLLAR INDEX fell another 18.4 basis points, so there wan't any help from that quarter, either. Looks like the buck wants to fall all the way to 82.40.

The Japanese Yen rose 33 basis points today, which might account for everything sickening. With the Bank of Japan keeping interest rates artificially low, hedge funds find it profitable to borrow yen & invest the proceeds in more remunerative investments. Profitable? Nay, it's free money, just back up the truck. You borrow yen at less than 1% & invest in US gov't bonds at 5%. Or you invest in the stock market. Worst thing that can happen is -- the yen rises. When this yen carry trade comes unravelled, O, 'twill be a fast dance indeed.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"

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.