Thursday, November 08, 2007

More Volatility in Silver & Gold Prices in the Future

Gold Price Close Today : 835.20
Gold Price Close Yesterday: 831.00
Change: $4.2 or 0.5%

Silver Price Close Today : 15.467
Silver Price Close Yesterday: 15.272
Change: 19.5 cents or 1.3%

US Dollar Index Today: 75.45
US Dollar Yesterday: 75.55
Change: -0.10 or -0.1%

Y'all have to accustom yourselves to more volatility in silver & gold prices. In the late aftermarket yesterday evening the SILVER PRICE actually dipped under $15, but this morning at the open was $15.625! Then in the aftermarket today -- after silver had closed up 19.5 cents at $15.467 & the GOLD PRICE up $4.20 at $835.20 -- gold dropped three bucks and silver dropped a nickel. Then it rose again, & back & forth.

It appears to me that as overbought as silver & gold are, they have yet further to climb. The gold price is bouncing off the epic $850 high of 1980, but this number is almost meaningless, since it only traded there one day in 1980 during a blow-off. The gold price will crack $850 then run for $900.

The silver price has only begun to run, moving into that phase of a precious metals advance when it outperforms the gold price. All this must yet unfold before this rally ends, and it has barely begun to unfold yet. Still, watch out for sudden corrections. It's a spooky market, out where no market has ever trod before (at least no silver & gold markets), so crazy things can happen, and hit you in the head like a hammer.

Still, all things weighed, I would keep on buying silver & gold. They have years left to run.

US DOLLAR INDEX dropped a dime today, 10 basis points to close at 75.45. Low day before yesterday was 75.20. Clearly, US Government has decided to inflate & let the dollar drop to reduce the burden of debt, or for whatever other stupid purpose they may have in mind. Still, watch out here for a surprise rally that catches the shorts unaware, since everybody, his brother-in-law, & his brother-in-law's dog must be short the dollar now, & they would panic like naked boys before mad hornets if the buck rose 100 basis points.

Nothing like fair, free, unfettered markets, huh? Well, maybe they exist in Schlaraffenland, but not in Amerika. The Dow today made a low at 13,079.48 after a 362 point down day yesterday, yet somehow (Wink! Wink! Toward the Nice Government Men) managed to recover & claw back to only 33.73 points down. Right, O, right.

I failed to point out to y'all yesterday how much the more important S&P500 fell yesterday, completely smashing the psychologically critical 1500 level.

Today, NGM notwithstanding, the Dow closed barely above its 200 day moving average, at 13,266.29 versus 13,215.63 for the 200 DMA. 'Tis the beginning, not the end of the plunge.

But most breathtaking of all is the DOW IN GOLD DOLLARS, closing today at a new post-1999 low, G$328.35 (15.884 oz). Forget what everybody else in the world, every other indicator says, & listen to the DiG$: "Stocks gonna fall LOTS more against 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"

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.