Wednesday, April 08, 2009

Worst Downside I Can See in the Gold Price is $850 - These Low Gold Prices Offer You a Rare Opportunity to Catch Gold "On Sale."

Gold Price Close Today : 884.80
Change: 2.60 or 0.3%

Silver Price Close Today : $12.335
Change: 10 cents or 0.8%

Gold Silver Ratio: 71.73
Change: -0.551 or -0.8%

Dow Industrial: 7,857.58
Change: 68.02 or 0.9%

US Dollar Index Today: 85.31
Change: 0.08 or 0.1%

My comments yesterday may have sounded a bit too pessimistic about metals, but I want y'all to understand how opaque the future really is, how volatile & confusing short term moves can be, and so how needful it is to view markets on a long term (primary trend) basis, with a good measure of fundamental analysis thrown in.

The GOLD PRICE rose today a big US$2.60 to a Comex close of US$884.80. With a range of $878 to $890, it was a quiet day. I still fear that gold's downside work has not been completely finished. Worst downside I can see is $850. These low prices offer you a rare opportunity to catch gold "on sale."

The SILVER PRICE rose 13 cents to $12.335 cents, not terribly enthusiastic. Looking at the chart, 12 cents obviously forms strong support. Silver will not be on the upswing again until it closes above $13.05 and gold closes above $890.

Keep on buying silver, and if it drops further, buy some more.

Keep your eyes on the horizon. Silver and Gold Prices are in a primary uptrend that will last another 5 - 10 years, dollar is in primary downtrend, as are stocks. Don't fight the trend. The trend's your friend.

STOCKS today piddled, but rose a few points. They remain in their rally mode, which will carry them on to 9,000 - 9,500. You'd better be selling them soon, unless you're holding on to them to use later as wallpaper.

THE US DOLLAR INDEX seems to have run out of steam today, up only 8 basis points to 85.31. Dollar is still targeting its 50 day moving average at 86.18. Looking at the dollar & the euro, one is hard pressed to choose which is the sorriest. Much as the dollar stinks, it remains sounder than the euro, which could fly apart on a moment's notice. What's the answer? Not the yen, which is sorrier than either of the other two, but the perpetual alternative currencies, silver and gold.

What in the world is going on with platinum and palladium? Platinum rose $22 today while palladium rose $8.

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.