Tuesday, March 10, 2009

Silver and Gold Prices Took a Pounding Today

Gold Price Close Today : $892.10
Change: -25.60 or -2.8%

Silver Price Close Today : $12.525
Change: -42.5 cents or -3.3%

Gold Silver Ratio: 71.23
Change: -0.520 or -0.7%

Dow Industrial: 6,930.40
Change: 3.91 or 0.1%

US Dollar Index Today: 87.62
Change: -1.23 or -1.4%

Silver and gold prices took a pounding today. Gold dropped 25.60 to 892.10, well below the 905 support that ought to have held unless more weakness lay in our future. Today's low was 890.85, which is another area of support (888 - 890). That might hold, but with stocks rallying and hedge funds pushing huge gobs of money around, gold might not hold. Below that gold has to reckon with US$850.

The silver price closed at 12.5250, down 42.5 cents. Low today was 12.46. As with gold, this marks a previous low and would could hold as a double bottom. However, more likely, given the outrageously bullish sentiment on silver and gold the past couple of weeks, it probably won't. The market needs to get a lot more negative on both. Of course, a couple of weeks of sideways movement could do that, without much lower prices.

Whether metals decline more or trade sideways from here, later this spring they ought to perk up again and make another shot forUS$1,000.

Several readers have sent me references on sites that may be useful in ferreting out counterfeit gold coins. A very good website from a dealer is www.onlygold.com/TurorialPages/Coin_SpecsFulScreen Version.htm, which gives diameters and thicknesses for a raft of coins. If you are serious about detecting counterfeits, you can visit www.fisch.co.za, a company which makes & sells a very handy and quick counterfeit detector. However, as I wrote earlier, simply weighing coins will expose most counterfeits, because silver & gold & platinum are so much denser than other metals. A lead counterfeit, would have to be 54% thicker that a regular Krugerrand, or it would weigh in 35% light.

Y'all please pray for my wife, Susan. She feels fine, but her heart rhythm won't settle down and she may need a pacemaker.

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.