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Friday, May 30, 2008

This Correction in Silver and Gold Prices is a Gift

Gold Price Close Today : 887.30
Gold Price Close Last Friday : 925.60
Change: -38.30 or -4.1%

Silver Price Close Today : 16.827
Silver Price Close Last Friday: 18.241
Change: $1.414 or -7.8%

US Dollar Index Today: 72.880
US Dollar Index Close Last Friday: 73.047
Change: -0.167 or -0.2%

What a week! And on Friday we get this unusual comparison, from last week's high to this week's low.

After my crow eating yesterday, I'd like to make clear what my mistake was, and what it wasn't. SILVER and GOLD PRICES had gotten ahead of themselves, but I thought they were ready to continue their rally. They weren't, so when they hit those support areas ($900 and $17) they both dropped like your car keys dropping out of your shirt pocket into Lake Michigan. But . . .

I do not believe that I am mistaken about 2 things.

First, the SILVER and GOLD PRICE lows hit on 1 May 2008. They are behind us. Silver and gold will not see lower prices, ever again, although they may get close enough to scare them to death. This correction was a gift, yea, a great gift to you procrastinators who have been putting off buying gold and silver until the "perfect" price came. Better get at your buying.

Second, I am still convinced that this correction differs from 2004 and 2006 in that it represents not the end of a move, but the continuation. That means the rally begun last August will pick up again, perhaps in June but certainly by beginning of August, and carry silver and gold prices to a new, higher peak in the fall. Very much higher.

On the other hand, instead of casting an eye at your future and making changes to your assets, you could just forget what some Tennessee hillbilly says and listen to the Wise and Great Ben Bernanke, because you know as the sagacious Chairman of the Board of Governors of the Federal Reserve Bank he actually serves no purpose in life but to protect and serve your financial future. Likewise Hank Paulson and all the rest of those Holy Monks of Government Trust in Washington. And they would never tell you everything is all right and to hold on to your US dollars unless it was best for you. Would they?

Stocks may still rally once more, but they are running out of time as they have run out of steam. Rally might carry the Dow up to 13,100, but probably not much above that. A rally that fails before it reaches that point would be worse still. Y'all may have missed my saying this before, but don't miss it now: Swap stocks for silver and gold.

DOW IN GOLD DOLLARS since the low last March failed to rally even half way to the overhead downtrend line. High has been about G$316(15.603 oz) while the 200 DMA stood at G$332 (16.061 oz). Clear message is that stocks remain weak against gold, very weak. Since the DiG$ now has turned down, it appears that we are entering a time when gold will once again strongly outperform stocks.

The US DOLLAR INDEX, traitor that it is, flaked again this week. It traded up as high 73.13, then today turned around and dropped 15 basis points to close below 73 yet again. I suspect the dollar will rally for several months, but it has not yet sent the short-sellers fleeing for cover. As Steve Saville of the Speculative Investor observes, if oil breaks and the dollar rallies 'twill give gold a tough time -- briefly.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Thursday, May 29, 2008

Silver and Gold Prices Will Not Exceed Previous Lows

Gold Price Close Today : 877.20
Gold Price Close Friday: 900.50
Change: -23.30 or -2.6%

Silver Price Close Today : 16.477
Silver Price Close Friday: 17.38
Change: -90.5 cents or -5.2%

US Dollar Index Today: 73.03
US Dollar Index Close Last Friday: 72.53
Change: 0.5 or 0.7%


I'm having a crowbecue here today. You know, that's like a barbecue where you eat crow instead of pork. A reader wrote me today from Texas. "The last of the downside, huh? Is that like buying a Tennessee mule at midnight?" Folks from Texas can get tetchious at times.

Okay, I was wrong, and spectacularly, which shows how important that support just under US$900 and $17 was. But it is to be expected when silver and gold prices correct after a crash that for a time they trade up and down in a tortuous zig-zag. However, I still believe that both silver and gold prices have seen their lows. After the sort of peak and crash we've seen this spring, silver and gold tend to hit their lowest price within 35 - 45 days from the peak. I believe we saw those lows on 1 May 2008 and although both metals may trade weakly for a few days, they will not exceed previous lows at $16.115 and $848.50.

STOCKS may rally once more. Can they pierce 13,150? I doubt it, but they can try. Inflation will kill them whether they rise or fall.

The US DOLLAR INDEX is on a tear, up 50 basis points today on top of two days' gains. That implies that the weakness we saw last week really was a second and higher bottom, laying groundwork for a rally that could run as high as 75.5. Yet after 'tis over, what will it gain? Nothing. The dollar is doomed.

Speaking of the dollar's doom, let me recommend you go to www.321gold and read Darryl Schoon's piece, The Shell Game, Don't say I didn't warn you.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Wednesday, May 28, 2008

Time to Buy More Silver and Gold

Gold Price Close Today : 900.50
Gold Price Close Friday: 907.9
Change: -7.20 or -0.8%

Silver Price Close Today : 17.38
Silver Price Close Friday: 17.42
Change: -4.5 cents or -0.3%

US Dollar Index Today: 72.53
US Dollar Index Close Last Friday: 72.38
Change: 0.15 or 0.2%%

Did today disprove my thesis that yesterday's gold and silver price drop was occasioned by options expiry? No. True, gold and silver prices dropped a bit more, but not past significant support. The gold price stopped at $900.50 and the silver price at $17.38, rather than breaking down further.

I think that's the last of the downside. Tomorrow should recover a little, then next week should see silver and gold prices rising. Rising dollar index and falling oil make a headwind for silver and gold prices.

Stocks are dead in the water. Time to buy more silver and gold, unless tomorrow sees them drop sharply (below $880 and $17).


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Tuesday, May 27, 2008

Gold and Silver Options Expiry

Gold Price Close Today : 907.90
Gold Price Close Friday: 925.60
Change: -17.90 or -1.9%

Silver Price Close Today : 17.425
Silver Price Close Friday: 18.241
Change: -81.6 cents or -4.5%

US Dollar Index Today: 72.38
US Dollar Index Close Last Friday: 73.047
Change: 0.44 or 0.6%


Today's gold and silver trading can be explained in two (2) words: options expiry. The black-shirted thieves who write options attack the price to run it down when they have a big cluster of call options about to expire profitably near market. Or if there is a big cluster of put options at some price near market, they run the price up. Happens nearly every time, and nearly every time they succeed.

Did y'all notice today that the Dow gained a lot, while silver and gold prices lost a lot? Options expiry. When they can move the price, option writers [read: the bullion banks] save themselves zillions.

If that is the reason gold and silver were trashed today, then expect a strong day tomorrow. My interpretation is that we saw a blip only because of options expiry. You will know tomorrow whether that's accurate or not.

Stocks did nothing today. Dollar popped up, but stayed within the same range that has bored us so long. Could be bouncing up off what I was guessing last week was a double bottom.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Friday, May 23, 2008

The Big Move is Coming in the Silver Price

Gold Price Close Today : 925.60
Gold Price Close Last Friday: 899
Change: 26.60 or 3%

Silver Price Close Today : 18.241
Silver Price Close Last Friday: 16.904
Change: $1.33 or 7.9%

US Dollar Index Today: 73.047
US Dollar Index Close Last Friday: 72.15
Change: 0.226 or 0.3%

Ahhh, here's a little fact that will make your meditative juices flow. In August 1979 the silver price began its parabolic rise from $9.20 on the road to $50. Along the way it made a single correction, dropping to a low of $16.165. Then recovering it hit resistance at $18.20, backed off slightly, and took off for the moon. Odd, the 1 May 2008 low was $16.115, and today the silver price broke through $18.20.

Just ponder that. The Big Move is coming in the silver price. I hope y'all have bought a truckload. Stop worrying about corrections and load up. The gold price might have done better today, and closed higher than Wednesday, but I'll take what I can get. As long as gold remains above $904 it will remain in an uptrend, but it needs to close above the last (double high) at $950 to remove all doubt of a rally. The silver price shouldn't close below $18 again, and probably next week will better the last high at $18.50 close.

This move will be very big, and won't peak until around end-October. If so, we'll execute our Gold/Silver Ratio swap then. I am now very confident that we saw the lows in silver and gold prices on 1 May 2008. Buy now, before the Big Move in silver and gold prices gains too much steam.


It always amazes me how long people will keep on denying the undeniable. They're sick, they don’t want to admit it, they avoid doctors, then bang! They become intimately acquainted with a funeral director.

So it is with stocks & the dollar. As I have pointed out until y'all want to groan, even adjusted for inflation the Dow at 14,000 (let alone 12,479) only equals its January 2000 high. This week stocks lost 507 points, yet the hord of sirens who make their living hawking stocks keep pondering and wondering & pontificating. Look -- dead is dead, let's face it, and once a bull market has peaked, it needs 15 - 20 years to recover. Look for stocks to perk up, then, around 2010 at the earliest, but more likely 2015, if then. Last warning: swap stocks for silver & gold.

The Dow in Silver Ounces made its low on 14 March at 580.85 oz. of silver to buy the Dow. It corrected upwar4d, and today stands at 684.15, about where it broke down into free fall on its way to 590. Eventually the Dow will sell for 32 (thirty-two) ounces of silver or less.

The brief rally in the Dow in Gold Dollars has ended, too. After a rally that carried only to G$315 (15.241 oz) the DiG$ is falling again, closing today at G$278.71 (13.483 oz) a few more gold dollars down and it will be banging on the old low at G$247.14 (11.955 oz). Before it's over, the Dow will sell for a mere two [sic] ounces of gold.

The US DOLLAR INDEX closed on the futures market at 82.05, but in the aftermarket traded as low as 71.94. A close below 71.89 will turn the dollar down for a long fall. Otherwise, this week's trading may have made a double bottom slightly higher than the last low, setting the stage for a rally to 75. Get out of all investments that promise to pay dollars in the future: bank deposits, annuities, insurance, certificates of deposit, pensions.

Stocks may make one more thrust upward, but 'tis only the last gasp of a dying market. If the Dow closes under 12,200 it crashes. S&P500 is about to close below crucial support at 1375. Lower prices coming, now or a couple of months from now.



Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Thursday, May 22, 2008

Gold Prices Relaxed a Bit Today

Gold Price Close Today : 917.90
Gold Price Close Yesterday: 928.00
Change: -10.10 or -1.1%

Silver Price Close Today : 17.975
Silver Price Close Yesterday: 17.998
Change: -2.3 cents or -0.1%

US Dollar Index Today: 72.15
US Dollar Index Close Yesterday: 71.89
Change: 0.25 or 0.4%

As I hinted yesterday, SILVER and GOLD PRICES relaxed a bit today. The GOLD PRICE was pummeled, closing at $917.90, down $10.10,while silver dropped only 2.3 cents to $17.975.

Do y'all see the disagreement? The SILVER PRICE refused to back off the way gold did. With both metals blasting upward, that non-confirmation is positive. I expect silver and gold to close higher tomorrow, finishing out the week above $18 and $930. But I ought to add that if they do NOT end the week higher than today, that would taste of weakness.

The gold price is testing its 50% correction level, silver roughly 62% (actually 58%). It's not surprising a lot of sellers gang up on them at those predictable levels. Be patient. Keep buying silver and gold.

Turning the world upside down, it's not surprising after two days' fall of 427 points that the Dow would,bounce today -- but Oh! What a dead cat, only 24 points.

About the US DOLLAR INDEX. Today it climbed above 72 again to close at 72.146, up 25 basis points. Let us assess. If it dipped below 72, and doesn't again,fall below that, then the dollar has a double bottom,with the previous (lower) low. However, another close below 72 would be fatal at this stage.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Wednesday, May 21, 2008

Silver and Gold Prices Exploded Again Today

Gold Price Close Today : 928.00
Gold Price Close Yesterday: 919.50
Change: 8.50 or 0.9%

Silver Price Close Today : 17.998
Silver Price Close Yesterday: 17.671
Change: 32.7 cents or 1.9%

US Dollar Index Today: 71.89
US Dollar Index Close Yesterday: 72.44
Change: -0.55 or -0.8%

SILVER and GOLD PRICES exploded today again. The GOLD PRICE closed at US$928, up $8.50 and past all that resistance from $905 to $925. The gold price today has recovered 48.7% of its fall from US$1,003.20 to US$848.90. That makes the past 2 days performance a bit tricky, because the upward correction could spend itself here. Possible, but not likely. The bottom has already occurred (in my opinion) on 1 May.

The SILVER PRICE has risen more than a dollar in the past two days. Trading today showed $17.60 as a firm floor. At $17.998, the silver price has recovered 58% of its fall from $20.574 to $16.121. Silver has now arrived at "fish or cut bait" time. Understanding that after a buck rise in two days the silver price may relax tomorrow, still, a close over $18 will send the silver price shooting up for the final hurdle, $18.75. And, silver looks ready to do just that. The silver price could be knocking on $19 by Friday.

My, my, the whole financial world seems to have come unstuck at the same time. The US Dollar dropped another 54 basis points today for a total over 100 basis points in two -- yes, two -- days. Looks like it has another couple dozen stories to fall before it hits dirt. Today it's trading at 71.892 while Nymex September Crude Oil is selling at 133.83 a barrel. If the US DOLLAR INDEX cannot hold on above 71.25, then it has begun another leg down.

STOCKS have dropped 427 points in two days, measured by the Dow, while the S&P500 today fell below the psychologically sensitive 1,400 mark. Stocks won't stop before Dow 12,200, most likely. Messy business. Makes it appear their rally has ended.

DOW IN GOLD DOLLARS has just collapsed in the last two days, down G$16.99 (0.820 oz.), from G$297.59 (14.396 oz) to G$280.7 (13.579 oz.). Aren't you glad you sold your stocks & put the proceeds into 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"
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 $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.



Tuesday, May 20, 2008

Silver and Gold Prices Came Through Resistance Like a Slingshot, But the Fight Only Begins Here

Gold Price Close Today : 919.50
Gold Price Close 12th of May: 905.70
Change: 14.50 or 1.6%

Silver Price Close Today : 17.671
Silver Price Close 12th of May : 16.974
Change: 69.7 cents or 4.1%

US Dollar Index Today: 72.44
US Dollar Index Close 12th of May: 73.047
Change: -0.58 or -0.8%

The GOLD PRICE broke through $905 resistance today and ran $14.50 to close at $919.50. Did I warn y'all? It closed barely above its 50 DMA (now $918.15). What are we rooting for? A close clearly above $960, which will signal the gold price has bolted from the starting gate once again.

SILVER PRICE broke through resistance just above $17 and jumped 69.7 cents to close at $17.671. Both metals came through that resistance like a slingshot, but the fight only begins here. All those milestones have to be passed -- 50% retracement, 62%, 75%, last high, and so forth until silver tops $18.70 and positions itself for another test of the old high at $21.00. It will.

Patience, patience. I think we've seen the bottom in silver and gold prices already, but if a spike down lies in the cards, it will come soon. Don't look for that, look up.

The US DOLLAR INDEX looks sick, and today's drop of 58.2 cents left the Dollar Index below 72.50 at 72.439, about 13 basis points above the 50 day moving average. Other indicators appear to have rolled over. A close below 72 will send the dollar down toward its earlier lows just above 71. Looketh bad for the buck.

I don't know what hit STOCKS today, but it was stout, knocking 199.5 points off the Dow and 13.25 points off the S&P 500, leaving the Dow wallowing at 12,800 support yet again. A close below 12,755 would drop to 12,270 very quickly, and leave everybody asking whether the "rally" was over. It would be.

I've gotta go mow hay. It's waist deep. I can hear one of my sons outside now mowing with our Percheron horses. One of them loves the horses, the other can't stand them. Personally, there's no place in the world I'd rather be than driving a team of horses, except of course for kissing my wife.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Monday, May 19, 2008

Silver and Gold Prices are Drawing an Uptrend, a Series of Higher Lows and Higher Highs

Gold Price Close Today : 905.00
Gold Price Close 12th of May: 883.70
Change: 21.30 or 2.4%

Silver Price Close Today : 16.974
Silver Price Close 12th of May : 17.158
Change: -18.40 cents or -1.1%

US Dollar Index Today: 73.047
US Dollar Index Close 12th of May: 72.940
Change: 0.107 or 0.1%

In the 10 days I was away, basically nothing happened. The Wednesday before we left (7 May) the gold price was at $869.60, the silver price at $16.617, the Dow at 12,814, and the US dollar index at 73.53. Yes, I understand that silver, gold, and the Dow are slightly higher, but they remain range bound.

This reinforces my interpretation that SILVER and GOLD PRICES will not drop any lower. Last week's weakness took silver and gold prices lower, but not to lower lows. Remember that an uptrend is a series of higher lows and higher highs, and that's what the gold and silver prices are drawing.

There remains, like a thin cloud on the horizon, a tiny chance that gold and silver prices will make one last spike bottom, but I would not wait on that. I already urged y'all to buy all your bargain basement silver and gold by mid- to end-May. Go for it now! I think you can safely buy.

Confirmation of that will only come from a gold price close above $960 and silver price close above $18.75. We probably won't see that for a while, as silver and gold prices trade sideways to steadily but not dramatically higher.

The GOLD/SILVER RATIO continues to trade sideways, following silver and gold prices. Since mid-March it has traded sideways with lower highs, building a long narrow triangle. When it breaks out of that triangle, it will drop like a begonia off a 22nd story balcony. Be patient, silver/gold swappers, the Big Swap is coming. I am not troubled that I warned you that it might come in May, but has not yet materialized. Best thing about the swapping strategy is that we are always either in silver or gold, so we can afford to wait patiently for swapping opportunities. If it doesn't come until October, but that won't bother me at all.

STOCKS remain as stagnant as they were when we flew to Seattle. The Dow in Gold Dollars has failed to pierce support at G$300 - G$308 (14.513 - 14.900 oz). The longer this drags out, the lower the likelihood that stocks will outperform gold. That goes double for stocks against silver. Sell stocks & put the proceeds in silver and gold. Otherwise, you guarantee losing your capital.

The US DOLLAR INDEX persists in running from every fight. Yes, it struggled to a slightly higher intraday high (73.89 vs. 73.50 earlier), but it also fell back below 73 again. What's worse, the Moving Average Convergence-Divergence looks like it has already topped. Not even a central banker could work up enthusiasm for this chart. To put it politely, the US Dollar stinks.(Ow! Did I say that? Sorry, George. Sorry, Ben. Sorry, Hank! Didn't mean to blow your cover!)


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Monday, May 12, 2008

Silver and Gold Prices Have Already Bottomed

Gold Price Close Today : 883.70
Change: 0.80 or -0.1%

Silver Price Close Today : 17.158
Change: 31.5 cents or 1.9%

US Dollar Index Today: 72.94
Change: -0.12 or -0.2%

SILVER and GOLD PRICE action since last Thursday, combined with the stock market and the dollar index is consistent with my suspicion that silver and gold prices have already bottomed.

It's possible still that we'll see a sudden, brief downward spike in silver and gold prices, but that grows less likely every day.

Remember y'all should have bought all your bargain-basement silver and gold by mid to end May.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Wednesday, May 07, 2008

Silver and Gold Prices are Bottoming Right Now - If You Fail to Buy this Month, You Will Miss the Bargain Prices

Gold Price Close Today : 869.60
Gold Price Close Yesterday: 876
Change: -6.40 or -0.7%

Silver Price Close Today : 16.617
Silver Price Close Yesterday: 16.780
Change: 16.3 cents or -1.0%

US Dollar Index Today: 73.53
US Dollar Index Yesterday: 73
Change: 0.54 or 0.7%

I hate to give y'all downside targets, because I know from my own feeble performance that we never hear a range of lower targets, only the lowest price. So if I tell you that the SILVER PRICE may bottom from $16.00 to $15.20, y'all only hear "$15.20," and, waiting for that very price, you don't buy when it actually bottoms at $16.00 or $15.80. Human nature.

How do you overcome it? Set a price at which you will buy silver, and regardless how you feel, butterflies in stomach, puking in wastebasket, etc., just buy when you hit that price, and never look back.

Silver and gold prices are bottoming right now. By mid-May or end-May latest, this correction will be history. If you fail to buy this month, you will miss the bargain prices.

Third, right about now we should see silver and gold prices begin to make a double bottom, as they react to resistance at $16.80 - $17.00 and $880-$890. Don't go to sleep; don't let the seeming lack of action lull you into inaction.

SILVER and GOLD PRICES will probably make another run at $16.80 - $17.00 and $880 - $890 resistance tomorrow. Of course they could cut clean thru and never look back, but I suspect that after this try or the next they will fall back, make a double bottom or lower bottom, and put an end for good to this downward correction.

The Dow in Gold Dollars is behaving as it did from May 2006 to July 2007, when it should have rallied to G$475 (22.978 oz, the half-way point of its fall from the 8/1999 high) but never managed to get higher than G$436 (21.092 oz) -- promising, promising, promising, but never delivering. If the DiG$ now reached its 200 DMA, it would hit about G$334 (16.491 oz), but so far has reached only G$315 (15.238 oz). Stocks' continuing failure to rally strongly against gold underscores their bear market weakness against both silver and gold prices.

The DOW JONES INDUSTRIAL AVERAGE today fell back 206.48 points to close at 12,814.35. Odd -- Dow just cannot seem to gain and keep ground, hinting at inward weakness. No secret where I stand: sell stocks and put the proceeds in silver and gold.

The US DOLLAR INDEX, after yesterday's fall, climbed 53.8 basis points to close at 73.534. The dollar's rally offers you an opportunity to swap dollar-denominated and dollar-paying assets for silver and gold. Never mind this little rally, the US dollar is locked in a primary down trend, so you want to get out of dollars and into silver and gold. "Out of dollars" means shuck any investment that promises to pay you dollars, because dollars tomorrow will surely be worth less than dollars today. Get out of annuities, insurance policies, certificates of deposit, bonds, anything that pays dollars in the future.



Tuesday, May 06, 2008

Gold Price Needs Close Strong Through $880 and then Close Above $904 to End Downside Action in Silver and Gold Prices

Gold Price Close Today : 876
Gold Price Close Yesterday: 872.30
Change: 3.7 or 0.4%

Silver Price Close Today : 16.780
Silver Price Close Yesterday: 16.746
Change: 3.4 cents or 0.2%

US Dollar Index Today: 73
US Dollar Index Yesterday: 73.18
Change: -0.19 or -0.3%

This was the sort of day that doesn't leave much to say in its wake. The GOLD PRICE rose a little, stocks rose a little, the US Dollar Index fell below 73.00 to close at 72.996. No big changes. But as I observed yesterday, the gold price is bumping against that $880 ceiling and the silver price against $16.80. These before offered support, now as surely present resistance.

If the gold price were to close strong through $880 and then advanced sharply to close above $904, I'd say we weren't about to see any more downside action in silver and gold prices. Until that happens, brace yourself for what might be a double bottom. Does that mean I wouldn't buy. Risk from $876 is down to $800, say 9.5%, for the silver price to max $15.20 or 9.6%. Viewing the long term bull market, that's acceptable risk. Don't waste the whole month waiting.

Stock market looks like its fizzling to me, losing its positive inertia. At this rate it will never make it to 14,000.

We are still waiting, and will keep on waiting, until the Gold/Silver ratio drops below 38.6:1 to swap silver for gold.

If we were swapping at all right now, we would swap gold for silver if you would like to leave an open order to swap silver for gold please call us at (888) 218-9226. Please mention goldprice.org when you call.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Monday, May 05, 2008

Buy Both Silver and Gold at These Prices

Gold Price Close Today : 872.30
Gold Price Close Last Friday: 856.1
Change: 16.20 or 1.9%

Silver Price Close Today : 16.746
Silver Price Close Last Friday: 16.381
Change: 36.5 cents or 2.2%

US Dollar Index Today: 73.18
US Dollar Index Last Friday: 73.514
Change: -0.33 or -0.5%

GOLD and SILVER PRICES steadily advanced today. They've just about reached the previous bottoms, now become resistance rather than support. Gold's resistance kicks in at $875 and silver's at $16.75.

Tomorrow should be interesting. Coming off such a long decline, silver and gold prices have a number of rising days ahead. Once that falters and corrects, we'll have confirmation of bottoms in the metals, but for now I must tentatively conclude we have seen those bottoms. Physical demand remains very, very strong as bargain hunters crowd in to buy at these low prices.

Buy both silver and gold at these prices.

Stocks' advance has carried the Dow as high as its 200 day moving average (today 13,044) but, as you might expect, the Dow's feet have gotten tangled trying to work through this barbed wire fence. I suspect higher prices are coming, but wouldn't it devastate stocks if the Dow couldn't pierce the 200 DMA?

The schizophrenic US DOLLAR INDEX, father of ulcers everywhere, dropped 33 basis points today to trade now at 73.18. I don't doubt it's headed higher, to 76.50 or 77, but it will torture everyone on the way.

On this day in 1893, panic hit the New York Stock Exchange. By year-end, the entire country was suffering a severe depression. The more things change (as the French say) the more they stay the same.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Friday, May 02, 2008

The Gold and Silver Bull Market Won't End Before 2014 or 2015

Gold Price Close Today : 856.1
Gold Price Close Last Friday: 887.2
Change: -31.1 or -3.5%

Silver Price Close Today : 16.381
Silver Price Close Last Friday: 16.85
Change: -49.90 cents or -2.8%

US Dollar Index Today: 73.514
US Dollar Index Last Friday: 72.668
Change: 0.846 or 1.2%


It's more than a little odd and bewildering that both SILVER and GOLD PRICES have been correcting for more time than the 2004 and 2006 crashes, but so far at less price loss. In other words, the correction ought to be complete in time, but not in price. This jumps to the conclusion that 2008's correction has finished, and will be shallower in price than 2004 and 2006.

By way of comparison, the gold price has dropped 15.4% so far from its 18 March 2008 high, against 12.4% in 2004 and 21.9% in 2006. The silver price as of 1 May had dropped 21.6% from its high, but in 2004 dropped 32.8% and 35.4% in 2006.

Trying to mesh this with the metals' seasonal patterns leads to more bewilderment. Usually metals drop into end-June/July for a low after a high in May, then make another high in October/November. Sometimes, just to mess with your mind, they peak & trough in the opposite seasons. This year they peaked in mid-March(huh?) and looks like they will trough by mid-May, end-May latest. Will they then rise into the summer, the usual seasonal low? Or will they trade sideways until August and then begin climbing?

About the only near-certainty here is that this correction will have ended by May 31. Mercy -- it may have already bottomed. Proof of that will only come, however, by a successful test of the lows so far.

Now everybody has his head turned down, so what are the maximum lows we might expect? US$785 on gold and $13.29 on silver. But I've been through this enough times to know that bending over looking for a bottom you'll get a crick in your neck that puts a crick in your trading. You are looking for a bottom so hard that you miss it when it comes, looking for one further down. That's silly. Silver & gold are in a bull market. What if you buy today and they drop another 10%? The bull market's rising tide will bail you out. I've worried and vexed myself about every one of these drops since 1999, and now the difference between $4.05 and $4.50, or US$342 and US$310 seems like no difference at all.

Of course, this sort of weather also brings out the really gigantic croakers. They're now singing that the deflationary depression is coming that will take gold down to $35 again and silver to 25 cents, etc., etc. and the bull market in silver and gold has ended. Well, suum quique, to each his own, but I doubt it. The metals bull market began in 2001. It won't end before 2014 or 2015, if then. Stay with your positions, add to them while metals are correcting and low, and shut your ears to the croakers like Ulysses shut his crews' ears to the Sirens. His own he left open, but he tied himself to the mast.

STOCKS are rallying, and the Dow industrials should carry to 14,000. Dow Transports made a new all-time high on 30 April, and whether the Industrials confirm that or not, for now that fuels stock optimism. Rallying stocks helps silver, so don't complain, just don't get suckered into buying or keeping stocks. Stock rally seems destined to carry into summer, again, differing from the usual flat summer pattern.

The US DOLLAR INDEX is just a-rallyin' and a-rallyin', picking up all the easy money off the inflexible & unwary shorts. Look for this rally to work its way toward 77 before it ends, but it won't hurt silver or gold too much. They've already established themselves as the alternative currencies to all fiat national currencies.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.



Thursday, May 01, 2008

Buy Some Silver Here. It's on Sale. If it Drops Further, Buy More.

Gold Price Close Today : 848.90
Gold Price Close Last Friday: 862.80
Change: 13.90 or -1.6%

Silver Price Close Today : 16.121
Silver Price Close Last Friday: 16.502
Change: -38.1 cents or -2.3%

US Dollar Index Today: 73.24
US Dollar Index Last Friday: 72.61
Change: 0.64 or 0.9%

Whew! That was some kind of reversal today. Yesterday after the market closed both silver and gold shot up, and it looked like a perfect key reversal -- break into new low territory then higher close -- but it obviously wasn't. Just as metals appeared yesterday to have turned up, stocks looked to have broken down.

The GOLD PRICE closed today down $13.90 at $848.90, after a high of $877.88 and a low of $845.90. Very simply, the gold price is locked in a downtrend. In time it has already fulfilled the profile of these waterfall crashes, but keeps falling. Support stands right here, at $848, then at $837, and $800, where the apex of a previous triangle stands. The 200 day moving average, another support area, stands at $821.95.

After yesterday's strong aftermarket, the $16.60 SILVER PRICE level broke early this morning then waterfall-ed to a low at $15.96 and spent the rest of the day bouncing up on $16.20. Support beneath us lies at $16.00, $15.25-$15.30, $15.00, and $13.74. Looking at past waterfalls, this one has lasted long enough. Expect silver's price low within the next two weeks longest. Don't forget the danger of looking so hard for a bottom that you miss it. Buy some silver here. It's on sale. If it drops further, buy more. It's on sale.

Today stocks broke 12,950 and then ran to close at 13,010. On 30 April I missed a new high close on the Dow Transports, which means higher stock prices if the Dow Industrials confirm with a new all time high close. That Dow Theory signal is normally very powerful, but remember the Transports must be confirmed by the Industrials. This rally finds itself (as also metals) outside -- way outside -- the seasonal pattern, assuming it has two to three months to run. Nor is a stock rally bad news for metals, since silver historically outperforms gold when stocks are rising. That should bring us closer to that lower ratio where swapping silver for gold will be profitable.

The US Dollar Index is headed higher, faster than we're accustomed to see. It closed today above its 50 DMA, up about 64 basis points at 73.242. Expect the dollar to teach all its despisers a lesson. 74.50 is first resistance, then 75.20. It could peak anywhere form 75.20 to 77 over the next two to three months.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.


- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
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 $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.