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Wednesday, January 31, 2007

Buy Silver & Gold. They Broke Out Today Over 650 and 1350. Stop Waiting, Buy now.

At the risk of speaking too subtly, I've got a word for y'all: buy silver & gold. They broke out today over 650 and 1350. Stop waiting, Buy now. Buy the breakout.

Today stocks, reacting to the voices of those tea-leaf-readers who interpret the sybillic pronunciations of the Federal Reserve Open Market Committee (FOMC, rhymes with vomic), jumped up to within points of their all time high (basis the Dow). Do the words "double top" ring a bell with any of y'all? My target for the Dow's top is 12,650, and we might see that tomorrow, then the grinding loss of blood while stocks roll over, slowly, clumsily, to the downside.

Dow in Gold Dollars fell today to a new low for the move. Does that sound like stocks are about to outperform gold? Not hardly. Now, more than ever, I urge y'all to swap stocks for silver & gold.

Crowds of shorts are waiting to pounce on silver & gold here, but these new closes will attract many new longs. Seesaw will wind up on the metals' side.

Gold/Silver ratio fell today, a good sign but small.

Sorry, I'm traveling tomorrow and Friday, so won't posting daily commentary. I'll be near Baltimore speaking for the Institute on the Constitution.

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, January 30, 2007

Can the Silver and Gold Price Breach 1331 & 650 - Tommorrow Will Tell

SILVER & GOLD PRICES today held on & defended critical levels at 1305 & 640.50 lows. That's what I wanted to see. Now -- can they breach 650 & 1331? Tomorrow will tell; I can't.

The US DOLLAR INDEX has fallen below 85 again. My, my, it's having a tough time holding on. From the chart it ought to rally more, but simply refuses to take off. Poor buck.

Weird picture in STOCKS. Look at the last 5 days' Dow on a daily chart and it drops from a peak at 12,620 down to 12,430, then up to a pair of double peaks at 12,540 posted yesterday and today. Looks just like the Dow Transportslately, with those two equal lower peaks after a higher peak. Looks weak to me, failing twice at the same place. 12,430 is the place where the next failure will occur, while 12,540 is the mark to beat on the upside.

The DOW in Gold Dollars can't rally. It is screaming at us that gold will be beating stocks for some time to come.

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, January 29, 2007

Silver Price Needs to Close Above 1318 and the Gold Price Above 633.30 or We'll Get a Little Correction

How many really filthy rich people do you know? Right. Not many. Now, how many people do you know who got rich trading stocks or commodities? Right, even fewer.

Which makes my point: it's not easy to read markets. It's not easy to discipline yourself to follow a sound strategy. If it were, all of us would be eating chicken every day & drinking Ripple all day, we'd be so rich.

So it oughtn't surprise anyone that a bull market takes such twists and devious leaps & bounds that the bull shakes nearly everybody off & cheats them of their easy ride.

Which brings me to today's SILVER & GOLD markets. They broke out last week. Clean through the downtrend lines, clean through resistance areas. Yes, they need to close above the really big resistance at 650 & 1406, but they've cleared all the steps in between. Gold has even closed above its December high. Today they backpedal, feeling around for their breakout point, & look weak.

Very well could be. Very well could get a selling panic, silver taking a terrible break of a dollar or more and gold $40. Still, I'm not worried, because I am utterly confident that both metals are in a primary bull market. I know that even if prices dip tomorrow, higher prices in the long run will surely bail me out.

As I said, it's not easy to read markets & discipline yourself, otherwise . . .

The SILVER PRICE needs to close above 1318 to remain in this uptrend, the GOLD PRICE above 633.30 or we'll get a little correction.

STOCK indices were mixed today, up piddling few points, down piddling few. Doesn't tell us much, but other indicators continue to weaken. Right now I expect one more little surge to push to a final top, then weeks and weeks of rolling over before a big break.A close below the November low about 12,075 would prove me wrong and imply the breakdown had begun.

Somebody asked me why I write every day, "Swap stocks for silver & gold." The answer is, because y'all don't get it. Not easily, anyway.

After a 20 year bull market in stocks, & the unremitting barrage of propaganda poured into your eyes & ears daily by government, Wall Street, banks, newspapers, magazines, and other leeches greedy for your money (no matter how small your mite), how will you believe a small voice like mine unless I repeat myself? The realities y'all believe (I know because they're what y'all act on) are an eternal dollar & eternal stock market bull. Well, truth is the daughter of time, so we'll see. In the meantime, swap stocks for silver & gold.

Go visit my friend Catherine Fitt's website at www.solari.com/store/where_would_jesus_bank.php. That's an audio seminar Catherine normally sells called "Where Would Jesus Bank?" Go, download it free, and listen to it at your leisure, when you can ponder what she says like fine wine.

What I like about Catherine is that the world is full and overfull of people who can tell you everything that's wrong with the world -- but most of them won't lift a finger to make it right. Catherine is teaching people how to extricate themselves from the toils of the economic Tapeworm that infests us all.

Y'all judge for yourselves. Go, visit Catherine's site and listen to "Where Would Jesus Bank?" To underscore her point, let me share with you the proprietary Moneychanger Banking System Reserve Indicator. I've been keeping it since 1998, to measure the real reserve ratio in the banking system, & how much money they can create. Last I checked, for every dollar you deposit in the bank, the banking system could create $162. That's not a joke. You leave $5000 in your checking account, and they can create roughly $813,000 in loans to destroy your wealth & your way of life,to ensnare your neighbour in their toils.

Believe me, it's worth listening to what Catherine has to say.

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, January 26, 2007

If You Haven't Yet Bought Silver & Gold, Stop Waiting. You'll Never Buy it Cheaper.

Last week I confessed that despite what others were saying, gold looked strong to me. It proved itself this week, soaring briefly during the day yesterday over 650. Today gold gave up 3.30, but remained comfortably above critical support at 640. This being Friday, I suspect a lot of longs with fat profits cashed out for the week.

The GOLD PRICE will come back next week for another shot at 650. It should break through. If so, gold will roar toward 740 before it even takes a break for breathing. As long as gold holds above 603, we have no problems, but from here I would bet you'll never see gold below 640 again.

The SILVER PRICE handily climbed above 1315, its last high, and then ran to 1350. Next week it should climb through that because this move is very young yet. A close over 1407 stops the mouths of all croakers & silver runs away. Silver stands above all its moving averages. Look for this rally to unfold very fast. On the downside silver must hold 1250, but I don't expect to see that price ever again.

THE US DOLLAR INDEX ended the week higher, along with silver and gold. That is another proof that silver & gold, which also rose this week, have decoupled from the US dollar and are behaving like independent currencies, which they are. Dollar is a dog long term, so flee dollar denominated assets like bonds, annuities, mortgages (as the mortgagee), & pensions.

The GOLD/SILVER ratio has finally begun to fall a bit this week, and has edged down toward the bottom of the last month's range. The ratio should fall below 35:1 during this rally. If you haven't yet bought silver & gold, stop waiting. You'll never buy it cheaper.

Weekly charts will reveal fascinating secrets this week. STOCKS made the first part of a "key reversal" this week on a weekly chart -- the Dow broke into new high territory, but closed the week lower. A follow-through next week with a lower close would put the top on the Dow. It's certainly possible: the Dow stands just over 12,450 support. If it falls through there, 122,340 is the next support, then 12,160. Owwww.

Other indices fell today, although the NASDAQ Comp rose a few points. The NASDAQ 100/Dow spread is headed lower, also not a good sign, and the Dow Transports (which must confirm new highs in the Industrials, according to Dow Theory) fainted today, nowhere near a new high.

The DOW IN GOLD DOLLARS, after falling below G$400 yesterday, rallied a couple of gold-bucks to G$400.51. The G$400 level will prove strong resistance. Does that mean gold will rise faster than stocks, or stocks fall faster than gold, or gold rise while stocks fall? Take Door No. 3. Which means -- for those who have not been paying attention -- that you ought to swap stocks for silver and gold, pronto.

By the way, the Dow hit a high of about 12,620 this week, not far from my 12,650 target. Was that the end? We'll see.

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, January 25, 2007

Buy the Breakout in Gold and Silver

I need say very, very little about SILVER & GOLD PRICES We are seeing the prices we have been waiting for. The gold price high today was 654.60, the silver price high was 1353. The gold price close was not quite above 650, but that we'll probably see that tomorrow. Nothing left to say here. Buy the breakout in gold and silver.

STOCKS fainted today. The Dow hit a high of 12,562.65 early in the day, & immediately started falling. It hit 12,560 and collapsed. Makes my 12,650 top forecast look better, but I'm not crowing yet. It could still reach 13,000 before the rally ends. However, today looked mighty sick. The Dow in Gold Dollars dropped below G$400 (19.35 oz) today and closed at G$398.97. Hear, O hear, before it is too late: swap stocks for silver & gold. Align your money with the primary trend.

The US DOLLAR INDEX rose today, above 85, but I think it will be dropping again. Anyway, it's worth noting (for all the gurus who are not looking) that gold and silver rose today in the teeth of a US Dollar rise. Silver and gold have decoupled from the dollar alone, and are now trading as independent currencies.

You ain't seen nothing yet.


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, January 23, 2007

This Gold Price Rally Could Unroll Faster, Much Faster than Anyone Expects

I could not have been wronger on silver & gold than I was yesterday, and today's trading proved it. Once the SILVER PRICE crossed 1310 and the GOLD PRICE crossed 640, what could stop them? Certainly no shorts.

The Silver Price has bettered its 2 January high at 1315, & stands above all its moving averages. Between here and 1520 stands only the 1406 high from last December. This rally could unroll faster, much faster than anyone expects.

The Gold Price 4 December 2006 high was 645.20, exactly where it closed today. Above this stands the 650 mark, important in the minds & wavering emotions of the market but not much technically. Then comes gold's July '06 high at 666.60. After that it's another trip to the May high at 720.

I have to interpret today's trading as very strong. Tomorrow should bring out the counterattack by the shorts, but this is the second attempt at these levels and so stands a good chance at overcoming.

The GOLD/SILVER ratio dropped slightly today, a comforting confirmation.

The assumption is against the US DOLLAR INDEX unless it can reverse and climb over 85. After climbing over the critical 85 mark yesterday, today's close
looked really weak. But on a longer term chart it doesn't look quite so bad. After all, it remains above its 200 DMA -- the dollar's only positive, other than the power to manipulate billions of created-out-of-the-air dollars in trading by Nice Government Men and the co-operation of NGM from foreign central banks.


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, January 22, 2007

As Long as Gold Stays Above 603, the Next Move will be a Bodacious Rally

The GOLD PRICE misbehaved today. It rose to a new high for the move (639.70), then closed lower than yesterday(Friday). Bad -- first part of a key reversal. Price will dip again tomorrow, maybe the next day. As my friend R.L. reminded me today, it can drop all the way to $603 without damaging the chart technically. A close below that now would bring catastrophe, but as long as gold stays above 603, the next move will be a bodacious rally.

The SILVER PRICE reflected the metal's confusion, closing slightly higher today while gold dropped. If silver drops from here, 1230 or so ought to hold. Expect the next 3 - 5 days to be spent in this reaction, and then the rally.

As I was saying, y'all, once the DOW falls through 12,540 support, it will fall a long ways. Today it happened. Now I don't believe the Dow has topped just yet, but today's fainting spell whispereth, "The end is near." In spite of gold's little drop today, the DOW IN GOLD DOLLARS dropped to G$407.27 (19.70 oz), clearly showing stocks weaker than gold, in perfect harmony with the primary trend. Once again, this underscores my point that you ought to **** ****** *** ****** *** ****. (Y'all fill in the blanks.) Here are more details: The Dow should fall to 12,360 - 12,337. Then it should make one more push up, the last one. My target for that is 12,650, but it might push all the way to 13,000. None of this will change my opinion that you should SELL STOCKS FOR SILVER AND GOLD because silver & gold are in primary bull markets and stocks are not.

The US DOLLAR INDEX seems to have completed its correction since it climbed back above 85 today. Watch it. A rise to 86 still lurketh in the cards.


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, January 19, 2007

Gold Likely to Close Above 650

This week's GOLD PRICE chart is a strange one. It broke out straight up through 620, went sideways between 630 & 636, then slammed straight down to 626, only to roar straight up again through 630 today and close at 635.50 today, a new high for the move.

I know very smart people, whom I respect, are calling for another spike down, but this week's trading simply exemplified strength and resilience to me. If gold close below 622, then we will see more downside. However, more likely is a close above 650.00 which will send all the short and the Nice Government Men running for cover & confirm that (1) the bottom hath been seen and (2) the rally hath begun.

Odd, the SILVER PRICE finished the week behind gold -- up, but a paltry few cents rather than gold's ten bucks & 1.9%. That gives the old ticker a check -- just skip a beat, then run right along -- but still silver not only finished the week in positive territory, it also closed above 1280, which has been critical resistance. Far's I can see, silver is set for a rally next week, unless it closes below 1250, which would be the first sign of trouble, followed immediately by further troublous signs. But wait! That's not what I expect to see. A close above 1315 (the last high) would stop the mouths of croakers, nay-sayers, & silver-fiends, & announce to the world that silver is rallying.

Except for gold, platinum, and palladium, this week spoke out of both sides of its mouth. But equivocation, as we all know, is no excuse. If you don't speak up right & proper, the answer is no, or I don't know.

Here, y'all, is a perfect example why I will never be a guru, internet, broadcast, or print. The Dow today closed off 8.25 points and the S&P 500 up a negligible 3.68. But what to my incredulous & unbelieving eyes should appear in the "Briefing.com" remarks right next to those quotes on msn.com? "Stocks are off their afternoon highs but holding onto the bulk of their gains [sic] going into the close."
Durned! I thought, I must be blind as a bat. Looked like stocks were down to me, or at best sideways. I rolled out a chart of the last 5 days' Dow trading. Again, what to my wondering eyes should appear, but a peak in the middle and a graph falling like eight tiny reindeer shot with a 30 ought six at close range with dum-dums.

Somebody's Christmas elf doesn't go all the way to the North Pole. Plain as can be, the Dow peaked on Wednesday with a 12,614 intraday high, closed lower, retried to rise but failed with an intraday high of 12,612, then fell the rest of the week. Today it twice fell through support at 12,540, but scrabbled back up. Now whether you want to this week's action a "key reversal" [break into new high territory with a lower close for the day followed by a lower close the next day] or whether you choose to call it a "double top [two days' failure at 12,614 followed by successively lower closes] doesn't matter to me, but whatever it is, it ain't
"holding onto the bulk of their gains."

Mercy! I'll never make a guru. I don't know enough about compost, and they deal wholesale in its prime ingredient.

Anyway, class, what do y'all call a series of lower highs & lower lows? That's right, a downtrend. And that is what the DOW IN GOLD DOLLARS has drawn on the chart, failing this week at critical G$425 (20.56 oz) resistance. Stocks will lose more ground against silver and gold, it appears. Therefore, unless you are a Wall St. guru, what would you do? That's right, swap stocks for silver & gold. We probably have not yet seen the high on stocks (look for 12,650) but are entering a correction of a week or two. Next high should be the last, then le deluge.



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, January 18, 2007

Gold Must Close Above 625 and Silver Above 1250

What was good about today's SILVER & GOLD PRICE action? Gold did not sink beneath 625 nor silver beneath 1250. What was bad about it? Neither metal rose. Tomorrow they must hold 622 & 1250, or I was wrong to conclude the correction was over. If they break those levels on closes, then they will undergo one more downside leg.

Meanwhile, the clock is ticking away. This is the time to buy silver and gold. Why will become obvious later in the year.

Glance at STOCKS once again. Today's down high reached 12, 612 against yesterdays 12,614, failed again, and closed lower. The 5-day chart shows a plain double top. Breakdown comes when it drops below 12,540 & 12,490. Only air beneath. It is headed down -- whether this is the big one or not. Remains possible that this is the last correction with one more leg up.

DOW IN GOLD DOLLARS rose slightly, but without meaning. Best course? Aktien um Silber & Gold vertauschen! (I thought I'd say it in German just to change things up.) Swap stocks for silver & gold.

The US DOLLAR INDEX remains under 85. Will recover enough to reach 86, but go farther? Juberous, as my grandmother used to say. That's Southern Hill dialect for "dubious."


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.



Wednesday, January 17, 2007

If You Have Been Waiting to Buy Silver and Gold, Stop Waiting

The SILVER & GOLD PRICES did what they were supposed to do today: they rose. Yet for full confirmation the correction has ended and the rally begun, silver needs to close above 1325 and gold over 650. If you have been waiting to buy silver and gold, stop waiting.

I was thinking today about the proper strategy for bull markets: get long and stay long. Don't fiddle around with trading in & out, just use every correction as an opportunity to add to your position. That's it. Not complex, not mind-stretching, but it still takes more discipline than most people have. They get scared out too easily.

Focus with me for a moment on the DOW Jones Industrial Average. Zoot alors! It climbed as high as 12,614 today, but closed lower than yesterday. Yes, y'all are right, & have been paying close attention -- that is the first half of a "key reversal." If it closes lower tomorrow, the Dow would have given us a very strong signal it will drop. Immediately. Y'all remember that a couple of months ago I said that the Dow's target was 12,650. High today was 12614. Of course, this may be just normal breath-catching in a rise, but I believe stocks are nearing the end of this rally. It will still take a while for them to turn over -- a market that huge doesn't turn on a dime, but the direction will soon be lower.

THE DOW IN GOLD DOLLARS dropped again today. What a useful & accurate indicator the DIG$ has been! It never lies, and only seldom speaks with forked tongue. The DiG$'s recent failure to get through G$425 helps to define the move from the low as a mere correction. The DiG$s has most likely already seen its high. Yet another reason to swap stocks for silver & gold.

Readers often e-mail asking me which stocks I mean. In brief, all stocks, excepting precious metals stocks or special situations you know are a sure thing, like a cure for cancer or a patent to turn dirt into money. Does that include mutual funds? Absolutely. Mutual funds (except for Bear funds) are made of stocks.

By the way, although precious metals stocks are supposed to rise faster than silver or gold themselves, some recent work by Ian McAvity shows that they don't, at least as an index. You'd be better off just buying silver or gold bullion and stashing it away (not to mention what would happen if you used my silver/gold swapping strategy to increase your ounces).

The US DOLLAR INDEX slipped today below 85, the equivalent of a drowning man dipping below the waves for the third time. I think the buck will yet reach 86, but there's no future there.

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, January 16, 2007

Expect Higher Silver and Gold Prices Tomorrow

Contemplating SILVER & GOLD PRICES will leave you biting you nails up to the elbow. I told y'all on Friday that the shorts would attack today, and they did. But both metals held on at the important support lines. Expect higher silver and gold prices tomorrow. The silver price needs to climb over 1300 to confirm it has resumed its rally; the gold price needs to close over 639.70, and will convince even the Nice Government Men when it closes over 650.00

Clearly, a silver close below 1213 and gold close below 604.90 would signal a steep downturn, although I don't at all expect that.

Behold! Today another oddity. Several weeks ago the Dow made an intraday high at 12,580. However, although it has made three new highs in the last 3 sessions, only today did it exceed that old intraday high with today's high at 12,585.08. May be nothing, but to eke out new highs by a few points each day without making new intraday highs seems, well, weak to me. But then, I'm no fan of stocks because they're in a primary bear market. They continue to grind barely higher but mostly sideways, drawing more and more bulls into the bear's den for later mauling.
Buttressing my bearish outlook is the DOW IN GOLD DOLLARS. After trying its itty best to make a new high, it couldn't exceed G$425 (20.56 oz), much less G$436 (21.09 oz) and today fell back to G$416.57 (20.15 oz). The DOW IN SILVER OUNCES is close to falling sharply, perhaps in a week or so. Lesson is clear: 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, January 12, 2007

The Gold and Silver Price Correction Has Ended and the Rally Has Begun - Unless We See Closes Lower Than Today's

My fate between last week, with an incredibly accurate forecast, and this week, with the opposite of my expectation realized, reminds me of that medieval "Wheel of Fortune" where some people are riding up and some falling off. I really did expect we'd see one last spike down in the SILVER & GOLD PRICE, but a vicious short covering rally today dispelled that hope.

The SILVER PRICE closed over 1250, the pivot point I had been watching, then ran all the way to 1280 resistance. The GOLD PRICE smashed through 614, 618, 622, and 625.

It really has become awfully difficult to make an argument that silver and gold have not already bottomed. In fact, I won't make it. Unless we see closes lower than today's, the silver & gold correction has ended and the rally begun.

Next week both metals ought to step out smartly and rise, rise, rise, after the initial counter-attack by the shorts on Tuesday. Remember, Monday is a government holiday and markets won't be open.

The US DOLLAR INDEX approached its 50 day moving average and got slapped winded, as they say in the South. Still, it remains above 85, and will probably touch 86 before this little rally ends. Lo, trust not that weak reed, the US DOLLAR, which, if a man lean on it, will pierce him through the hand. Get out of US Dollar denominated investments now -- right now.

The DOW's high today only reached 12,561.04, still 20 points beneath the last intraday high, although another "new high close" occurred today. With yesterday's breakout to a new high, you would expect some spirited follow-through today, say, a 100 point rise at least, right? Didn't get it -- rose 41 points. How do you describe a market that breaks milestones but fails to run with the breakout? The W-word springs foremost to mind, as in "Weak."

Notice also that the DOW IN GOLD DOLLARS collapsed today, unable to pierce resistance at G$425 (20.56 oz) and falling back. That certainly hints loudly that Stocks aren't going to do much better against gold than they already have last year. The conclusion? 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.



The Bottom in the Gold and Silver Price is Near - Hours or Days, Not Weeks

Both the SILVER PRICE & GOLD PRICE dropped sharply in the after-market. Well, sharp to me at $1.80 for gold and six cents for silver. However, the gold price has support all the way down to 609. A break of 606 will test 600. If 600 folds, then 590 is a sure thing. Look for a sharp, fast V-bottom. That bottom is near -- hours or days, not weeks.

The silver price closing below 1238 -- just below at 1237.50 -- bothers me. As silver was floating down from its 4 December 1406 high, it stopped and rallied from 1238.2 (18 December), then caught and rallied again from 1235.8 (21 December).

Why did silver fail to close above 1238.2? it was only 0.7 point. Tomorrow ought to see the water- shed. Either silver will (1) climb on past 1250 & confirm an uptrend or (2) collapse and fall back toward a V-bottom around 1200 - 1175. You need wakeful, sharp eyes. This will happen fast and not last long, so you must act quickly to catch it.

But then, I would buy silver and gold at today's prices. You can shoot yourself in the foot and miss buying altogether by trying to get too perfect & spear the very bottom. Remember what happens to pigs.

Odd. Odd. Passing odd. The DOW posted a new high close today (by four measly points), but today's high at 12,544.46 fell below the previous intraday high at 12,580.35 on 3 January. All this has an otherworldly, double top feeling to it, and looks like it on the chart.

The DOW IN GOLD DOLLARS looks the same only moreso. The DiG$ high close (for the move) occurred 5 January at G$423.69 (20.50 oz) while today it closed at G$422.45 (20.44 oz). Looks like a top. Swap stocks for silver & gold.

But look -- I have another hand! On the other hand, if the DiG$ breaks this resistance it will test G$435.90 (21.09 oz) or even G$475 (22.98 oz). If it fails here, it will set this G$425 area in concrete as resistance. Either way, something will break soon, probably tomorrow.

The US DOLLAR INDEX continues in its uptrend targeting 86. The 200 Day Moving average at 85.58 will create trouble and vexation for the buck.

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.



Wednesday, January 10, 2007

Ominously,The Silver Price Fell Below 1238 and the Gold Price Below 614

Today y'all learned the need for confirmation. In spite of yesterday's strong close just beneath resistance, the SILVER and GOLD PRICE fell back.

Ominously, the silver price fell below 1238 and the gold price below 614. Another leg down lies in their future. Remember the bottom targets I have been discussing are 1175 and 580, but don't get those fixed in your minds as my target, only as a possibility. Remember also that bottoms in silver and gold have been very quick, sharp, V-bottomed affairs. Don't fool around, and watch closely.

Silver's 200 day Moving Average stands at 1213.5. Looking back over the chart at previous corrections that reached the 200 DMA, silver usually trades through the 200 DMA and beneath it for a week to two weeks. We certainly haven't seen that yet, so keep your eyes peeled.

I stared at the GOLD/SILVER RATIO chart today until my eyes started to bleed. The 200 DMA stands at 51.26, a reasonable target, and the top of the trading channel today stands around 52.50. So far it might go, but no further. May not even see that high.

The Dow In Gold Dollars (DiG$) high for this move was G$423.69 (20.5 oz) on last Friday. After three tries the DiG$ has still failed to better that and today closed at G$420.64 (20.35 oz). Tis now come to very strong resistance all the way to G$435.90 (21.09 oz). If it fails here, 'twill begin its next leg down. If it pierces this resistance, 'twill climb to G$475 (22.98 oz).
But STOCKS are not particularly helping themselves. Today the Dow stopped slightly below this week's high (12,465). If it can break that it must climb to 12,515. Still a see-saw market, making as much progress around the playground as a jet-propelled teeter-totter.

Wow, that's odd. The US DOLLAR INDEX rose 34 basis points today. Same number of basis points it jumped twice at the year's beginning. Nice Government Men getting clumsy? Ought to cover their tracks better than that. Dollar over 85 means a rally to 86 or 86.5, maybe even 87.

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, January 09, 2007

Perfect Sucker Trap in Gold and Silver or Did Yesterday Mark the Bottom of the Correction?

Wow. SILVER PRICES and GOLD PRICES both advanced smartly today, but closed tantalizingly below what was needed for confirmation.

The gold price closed up 5.60 at 613.10, but needed to close over 614 (last low).

The silver price closed at 1249.80 -- right in the 1250 resistance area, but below the last close (1255) and other previous closes (1251 & 1250.8). Of course, there were also several closes in the same period at 1238 where silver turned around and headed up. Is 1249.80 too low to confirm, or, since it's above 1238, maybe that was the resistance.

Sounds like splitting hairs, but 'tisn't. This could be the perfect sucker trap before another push down (it always seems strongest in a correction right before it collapses) or yesterday might have marked the bottom of the correction. How will we know? Silver & gold prices will both close higher tomorrow.

And here's a kicker to keep in mind so that y'all do not again fall prey to the guru of press, TV screen, and internet: gold and silver rose at the same time the dollar index rose. Both rose smartly. So where's the lock-step relation, gold up/dollar down and dollar up/gold down? Nowhere. That's not to say silver & gold performance is not related to the dollar, only to point out that day by day moves, or even moves over several month, may not be directly related, and that the eroding dollar may be the chief long term cause of a silver & gold bull market, but not the only cause. Try the yen & Euro for starters, then add all the debt bubble created in Greenspan's Golden Age of the '90s.

STOCKS have traded sideways since last Thursday. A break below 12,375 will take the Dow much further down, or a break above 12, 450 would lead to a challenge of 12,550. For either party I am unenthusiastic. I'd rather swap stocks for silver & gold. Here's why: In 2006, the Dow rose 16.3%; gold rose 22.8%, and silver rose 45.3% [sic]. Clear?

The DOW IN GOLD DOLLARS fell again today. Stocks just can't seem to gain 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"
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, January 08, 2007

Look for Tomorrow to Test Last Week's Silver & Gold Price Lows

Y'all, it ain't over till it's over. The SILVER PRICE & GOLD PRICE both bounced back today, but 'twas only a bounce, not a slam dunk.

The silver price (still the stronger of the two) climbed all the way to the top of resistance at 1226, but now needs to close above 1250 to confirm that this leg down has ended. Likewise the gold price must clear 618 - 622. Look for tomorrow to test last week's lows in silver & gold. May break, may not, but if it does it should be the last of low prices and beginning of next rally.

Another possibility is several days of meandering back & forth in this area, but silver doesn't usually dally about corrections. This one neareth its end.

STOCKS, stocks, what can I say about stocks? Don't buy 'em. Sell 'em if you got 'em. Swap 'em for silver & gold. Today's little bounce didn't prove anything, but did get stocks up over 12,400. Technical problems are developing with weakness in the Nasdaq 100 versus the Dow and ambiguity with the Dow Transports. Think of the stalemate on the French front in World War I -- no man's land, nobody could win, only shoot up lots of ammo & take casualties. That's where the stock market is today. Remember that when the bands start playing & the soldiers marching, tempting you to join.

The US DOLLAR INDEX has stopped dead in its tracks. Appears that the sceptics all got together to sell today. If the dollar doesn't follow through with higher prices tomorrow, rally has been just another false start.


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, January 05, 2007

Gold Price Made a Low at 601.30 Buy Gold Now

I probably ought to hang up my hat and never write another daily commentary. Yesterday I wrote that "if [gold] breaks 618,look for a fall through the last low close (614) all the way to 600. If so, 'twill happen fast, and rebound just as fast."

Today the GOLD PRICE dropped $19.00, made a low at 601.30, and closed at 604.90.

Of the SILVER PRICE I wrote yesterday, "The bottom of silver's trading channel lies around 1175 - 1150, so that's as far as I can see it falling. But firstit must fall through strong support at 1240 - 1250. Another downside target is the 200 day moving average at 1218, close to 1225 support and the bottom Bollinger Band at 1202. Watch alertly for volatile silver to drop very fast in the next 2-3 days and recover just as fast."

Today silver dropped 59.7 cents, made a low at 1203, and closed at 1213.

Folks, I am not that accurate, so don't expect this every day.Now, what should we expect from here, and what's causing it? The US Dollar index closed up 29 basis points today, and up 100 basis points from last Friday. It broke out over the last high at 84.22 and is targeting 86 - 86.50 from here. That's not the cause of gold's fall, but it flows along with the same current of events & speeds them along.

The cause of gold's drop, technically is the need to finish out the final leg of the correction that began 1 December 2006. The gold price made a huge move last year, topped in May at 720, and then spent from May through November correcting,as did silver. What's driving gold & silver prices is the long term depreciation of the US dollar, & the economic havoc the "managers" of that currency have caused. Until all those toxins are flushed from the economy's body, it will undergo one fever after another, declining all the way.

Both silver and gold prices are near their bottoms. They may drop sharply one or two more days, but today's recoveries point out the lesson these bull markets have been teaching us: they won't stay down long. Expect another short, sharp correction, then 8 - 10 days of strength-gathering before they rally again. Buy gold and silver now. If you don't want to buy at these prices, then keep your eye peeled & buy if they fall. Most of all, don't let the hope of hitting the perfect price at the bottom paralyze you. Buy now.

STOCKS are looking pretty peaked, and today fell through the first minor support at 12,400. We may have already seen the Dow's high, or it may poke up a bit higher, but now we are entering the frustrating phase where stocks are rolling over to the downside, up one day, down the next, always running into overhead resistance, always disappointing. Take this gift the market is handing you, and swap stocks for silver & gold.

The DOW IN GOLD DOLLARS shot up on today's gold weakness to G$425 (20.56 oz). There remains the remote possibility that it will climb all the way to the halfway point at G$475 (22.98 oz), but first it must beat stiffer resistance at G$436 (21.09 oz). A close above G$436 would signal a run for G$475.

Things I would have nightmares about if I had nightmares: the possibility that I am dead wrong about everything. The Gold/Silver ratio rallies back to 75, and the Dow in Gold Dollars rallies to G$555 (26.85 oz). Silver falls and gold stagnates and erodes. Three years pass before the bull market resumes in force. Stocks continue to gain, but always much less than inflation. The US Government apologizes for all the trouble it has caused trying to re-make the world; the Federal Reserve board apologizes for robbing the American people and the world for the last 94 years and votes to abolish itself. Venus fly traps apologize to flies.

Like I said, a nightmare -- dreams. Said just to let you know that no matter how well you think you have scoped things out,"pride goeth before a fall." I think about it, too.

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, January 04, 2007

If gold breaks 618 look for a fall through the last low close (614) all the way to 600

Today the GOLD PRICE dropped, while the SILVER PRICE rose -- metals speak with forked tongue. Non-confirmations reveal confusion & indecision in markets, and that's what we have here.

Gold has support at 626/5 and 618/622, so today's attack forced the gold price down a single resistance level -- not bad. However, if it breaks 618, look for a fall through the last low close (614) all the way to 600. If so, 'twill happen fast, and rebound just as fast. Therefore, keep your eye peeled. You ought to be buying here.

The bottom of silver's trading channel lies around 1175 - 1150, so that's as far as I can see it falling. But first it must fall through strong support at 1240 - 1250. Another downside target is the 200 day moving average at 1218, close to 1225 support and the bottom Bollinger Band at 1202. Watch alertly for volatile silver to drop very fast in the next two - three days and recover just as fast. Buy silver.

A gold price close over 640 and silver price over 1315 means that no lower prices will be seen & the metals have turned.

If the GOLD/SILVER RATIO rises over 51.50 in the next few days, swap gold for silver. Most of y'all have already swapped silver for gold at much higher ratios, but if you haven't, or you have a little more gold you want to swap for silver, 51.50 or better would be the place to trade. We want to be in silver because we expect the ratio to drop below 35:1 this move. (Gold will fall from costing 50 ounces of silver to costing less than 35 oz. of silver.)

STOCKS double bottomed Wednesday and today just above 12,400 but stopped today way short of resistance (and last top) at 12,520, which now stands as the great challenge. We are seeing the same pointless meandering I warned y'all of. What can I say? Swap stocks for silver and gold. Before it's too late. Yes, yes, I know I keep repeating the same thing, it's because it still needs to be done. I feel like Cato the Elder in the Roman senate, ending every speech with "Carthago delenda est!" Carthage must be destroyed. In the end, he was right.

The US DOLLAR INDEX broke out today with a close at 84.32 -- probably. Needs to confirm yet with a higher close tomorrow. Target is 86.00 to 86.50, but with a market manipulated by Nice Government Men, who can ever say with certainty? Remember this: all currency markets are manipulated. They have to be, because otherwise they'd sink to their intrinsic value, namely, zero.

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.



Wednesday, January 03, 2007

Gold and Silver Price Weakness could last 3 - 10 Days

Yesterday I was feeling a bit queasy about the first real trading day of the year today, so I wrote about the SILVER PRICE and GOLD PRICE, "For both metals possibly one more downleg lies in the future," and that's what we saw today. Silver held up well, stopping once again above 1250, and number that is beginning to look like the Rock of Gibraltar (can't be cracked). Tomorrow, though, will bring the tough attack.

The gold price performed about the same as the silver price, falling only to the next support at 626. I'm certain the shorts will try to crack both metals again tomorrow, & we'll see then what sort of strength they have, but most importantly, whether they will make new lows for this correction, lower than the ones we've already seen at 1235.80 and 614. Weakness could last 3 - 10 days.

For you sideliners who have been hesitating to buy, go after it now. Don't wait for the perfect price. Remember the proverb: Bulls get rich, and bears get rich, but pigs get slaughtered.

Of the US DOLLAR INDEX yesterday I wrote, "It is probably about ready to rally for one more leg up say, as far as 84 or 84.22 before it makes its return trip to the old low at 80.50." Well, speak of the devil and up he pops. The buck closed today at 83.95, up a sweltering 70 basis points and enough to send the shorts running to puke in their wastebaskets. The dollar's little surge didn't cause silver & gold to stumble, but contributed to the size of the stumble & illustrates what mentality was running the market today.

STOCKS today behaved confused, bewildered. A few more than half the indices rose tiny amounts (Dow up 11.37) while the rest dropped small amounts. Market doesn't know which way to jump. Not a good sign. As long as stocks remain high, y'all are missing the Main Chance for the next decade if you don't swap your stocks for silver and 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.



Tuesday, January 02, 2007

Gold Price Needs to Close Over $656 to Confirm Break Out

Most markets were closed today, in deference to ex-president Ford's funeral, but the money-grubbers in the computerized commodity market don't care about things like that, so they stayed open anyway.

The GOLD PRICE closed well into the 634-640 resistance zone, & well on its way to challenging 650, but alas! The steely-eyed technical purist will demand a close over 656 to confirm a breakout. (Gold also stands above its 200 & 50 DMA).

The SILVER PRICE traded all day above the psychologically significant round number 1300 and well above its 50 day moving average (1294), but a close over 1327 is the number we need to see.

For both gold and silver possibly one more downleg lies in the future, but if that happens, would it carry to prices as low as those we've already seen? When traders return & markets re-open tomorrow, we'll quickly see.

Stock markets were closed today.

The US DOLLAR INDEX dropped again today, down to 83.26.It is probably about ready to rally for one more leg up, say, as far as 84 or 84.22 before it makes its return trip to the old low at 80.50.

Here are some suggested New Year's resolutions for the resolutionally challenged and procrastinators: Make 2007 the year you (1) get out of all US Dollar denominated investments & (2) stock swaps for silver and gold. Or, alternatively, you could begin to practice spending your latter years in poverty.

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.