Friday, March 27, 2009

Only Closes Below 12.50 and 906 Would Take Silver and Gold Prices Lower

Gold Price Close Today : $923.20
Gold Price Close 20th March: $955.80
Change: -32.60 or -4.2%

Silver Price Close Today : $13.251
Silver Price Close 20th March: $13.827
Change: -57.60 cents or -3.4%

Gold Silver Ratio: 69.67
Gold Silver Ratio Close 20th March: 69.13
Change: 0.54 or -0.8%

Dow Industrial: 7,776.18
Dow Close 20th March: 7,278.38
Change: 497.800 or 6.8%

US Dollar Index Today: 85.140
US Dollar Close 20th March: 83.708
Change: 1.432 or 1.7%

'Twas a week of treading water for range-bound silver and gold, a rising week for counter-trend rallying stocks. Today the FDIC closed Omni National Bank in Atlanta, 21st bank they've closed this year. Case you were wondering, that works out to one bank closed every four days. Yea, buddy, that's success! Comrade Timmy Geithner wants more power to regulate Wall Street, especially hedge funds and derivatives. Pardon, but isn't that like setting Col. Sanders as a guard over the chicken coop? Quis custodiet custodes ipsos? Who will guard Comrade Timmy and the other guards?

GOLD's indicators are pointing higher, although today it fell US$16.80 to US$923.20. I'm afraid the gold price will be range-bound for a while, between 920 and 950. Actually, you could broaden that range out to 890, but every time it approaches 920, enthusiastic buyers spring from the earth. Physical gold supply continues to tighten. No American Eagles available anywhere, Austrian 100 coronas not to be found, Mexican 50 pesos all gone on vacation. Let's see -- is disappearing supply a sign of a market headed down? Doubtful.

The SILVER PRICE closed down 35.6 cents today at $13.2510. It is tracing out another rounding bottom or saucer formation with a rim at 14.50. As with gold, silver is trading in a range, from 14.00 to 12.50/12.00. This sideways trading is very frustrating. Just when you think you've caught it, it drops back. Indicators still point up. After it climbs above 14.50 silver will hit 16.00 before you can say, "Scat!

Be patient, keep buying every dip in silver and gold. As long as they hold above 906 and 12.50, it's just a range. Only closes below those levels would take metals lower.

In a reprise of this year's earlier downward volatility, the US DOLLAR INDEX today rose 100+ basis points. The euro dropped on a budget warning from the German finance minister and the British pound took a drubbing on revised economic activity figures. Who benefited but the sick kid on the block? Just imagine what this volatility is doing to people who have to trade currencies and importers/exporters. It's shredding their hopes of profit. Weekly and Daily charts for the Dollar index still look topped out. Every time the dollar rises you ought to grab the opportunity to shuck dollars and dollar-paying investments for silver and gold.

STOCKS have probably worn out the first leg of their rally, and will rest for a few days. Rally will run longer, and further, but just needs a little rest. Maximum target appears to be 9,000 to 9,400.

Y'all have a great weekend.

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

- Franklin Sanders, The Moneychanger

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.