Monday, June 16, 2008

Silver and Gold Prices are Trading Sideways, Building a Base for a Move that Ought to Start not Later than Mid-August

Gold Price Close Today : 883.60
Gold Price Close Last Friday: 870.30
Change: 13.30 or 1.5%

Silver Price Close Today : 17.21
Silver Price Close Last Friday: 16.54
Change: 67 cents or 4.1%

US Dollar Index Today: 73.67
US Dollar Index Last Friday: 74.04
Change: -0.37 or -0.5%

Silver's spectacular jump today, along with the dollar index's wretched collapse and stocks' confused showing, leaves me more confident than ever that silver and gold owners have placed themselves on the right side of the train.

Today the GOLD PRICE jumped up $13.30, touched its 50 DMA at $897.75, then backed off. Not only is the gold price building a sidewise triangle, it is now trading into a narrowing triangle between the 50 DMA above and 200 DMA(today $856.05) below. Perhaps if gold won't dip to visit its 200 DMA, the 200 DMA will rise up to meet gold!

How to interpret the metals' trading today? That astringent volatility points to some VERY nervous shorts, and a market that hasn't decided yet which way everything will fall out. Relax -- it's summertime and directionless markets are the rule here. Silver and gold prices are trading sideways, building a base for a move that ought to start not later than mid-August.

The DOLLAR INDEX fell away from the outside of its Bollinger Band channel, but this is not surprising. The fall, however, was a bit excessive, but was probably just touching back to 73.50 resistance/support, before it takes off -- if ever. A close below 73.50 would turn the dollar down.

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.