Wednesday, April 09, 2008

The Crisis Has Passed for Silver and Gold Prices

Gold Price Close Today : 933.60
Change: 19.60 or 2.1%

Silver Price Close Today : 18.170
Change: 49.5 cents or 2.8%

US Dollar Index Today: 71.86
Change: -0.43 or 0.4%

Sorry I missed sending y'all commentaries yesterday and Monday, but I was wrapped up in a project very dear to me and could not get unwrapped in time to send the commentary.

In fact, I wouldn't have had much to say the past two days, since we can only wait and watch silver and gold prices creep up to prove or disprove that their correction has ended.

Over the last three days SILVER and GOLD PRICES may have seemed to act randomly, but they haven't. They have established bottoms, tested them, and rebounded through resistance.

Today the gold price seems to have pierced the $925 - $930 resistance, while the silver price rose above its 17 day moving average $17.95 and almost closed above its 50 DMA $18.18.

The crisis, I believe, has passed for silver and gold prices, but confirmation will only come (isn't life just like that) when they close above their last highs at $960 and $18.51.

All right, after times of bafflement and bewilderment, we have to lift our eyes up to the horizon and remember the long term, and why we bought silver and gold anyway: both are in a primary uptrend or bull market for another 10 years. That ought to make the volatility and turmoil easier.

Next drama to expect is a strong rally in silver and gold prices. Seasonally, they should peak by mid June, and this ought to be a strong time of year for them.

I understand that many analysts are momentarily expecting a big Dow rally, but it hasn't materialized yet. So far that 12,750 barrier has stopped the Dow dead. But if or when it does pierce that, a rally will follow. Personally, I don't give a hoot whether stocks rally or not, since I expect them to lose value pitifully over the next 10 years against silver and gold.

The US DOLLAR INDEX makes life hard on friends & foes alike. Yet again, after a long chain of "yet agains" it failed to get through 72.30 and fell today by 43.4 basis points to 71.86. Best colour an optimist might put on this behaviour is that the dollar is building a long, sideways triangle which might (50-50) break out to the upside.

Mmmmm... Did y'all notice that in spite of Super-banker Bernanke's best efforts, stocks and the dollar haven't done much. About the only thing to his credit so far (and bottom line hasn't been drawn there yet) is that the entire world financial structure has not collapsed. Good work, Super-banker!

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 $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.