Saturday, September 15, 2007

Will The Gold Price Correct Once More Between Now & November?

Gold Price Close Last Week : 704.30
Gold Price Close This Week: 709.60
Change: 5.30 or 0.8%

Silver Price Close Last Week : 1254
Silver Price Close This Week: 1254.4
Change: 0.40 cents or 0%

Notice that this week's commentary takes us from Monday though Friday, not Friday to Friday. Makes sense to do it that way, in light of the tumultuous week in metals.

Big question agitating GOLD & SILVER PRICES is whether the present gold price rally is "real", or the gold price will correct once more between now & November. Gold's performance Friday was not encouraging, bouncing off 717 to close only 2.20 above Thursday -- not quite a key reversal, but looking like a reversal anyway. One more push up & failure next week would put a cap on the gold price, & cinch a long correction bottoming in October-November.

The SILVER PRICE chart this week looks very different. It doesn't climb through the week, but made two attempts on 1276 & failed in both.

On the downside, closes below 685 and 1221 turn metals down. Upside gold must close over 720 for two days running, & silver must close over 1300. I view as very likely also a rise in the Gold/Silver Ratio to 60:1 before this "season of correction" ends.

Stocks hang over the cliff of one disaster, then another. It's like a bad silent movie serial. 'Twon't end well. A close below 13,125 falls quickly to 12,850, below which the trap door opens & the abyss yawns. Dow needs a close above 13,658 to convince anybody of anything. Next week should be a bad one. Swap stocks for silver & gold.

The US Dollar index has made new lows this week, & ended six down days in a row. Surely, surely the buck has fallen about as far as it will. Next big move will be a rally that takes all complacency by surprise & bashes its head into a wall. Buck still has no long term future, but every dog has his day, brief though it may be.

The DOW IN GOLD DOLLARS collapsed this week, dropping all the way to G$385 (18.624 oz). Not only has it dropped through support at G$415 & G$400, but it has also fallen through a major down-trend line. Listen, friends, to this most reliable indicator, for it warns, "Stocks are about to crash against gold." Against silver, too, no doubt.

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.