Wednesday, May 13, 2009

The Gold Price Clearly is Trying to Fight its Way Through $928, but is Trudging Through Deep Mud

Gold Price Close Today : 925.50
Change: 2.00 or 0.2%

Silver Price Close Today : 14.195
Change: -19.5 cents or -1.4%

Gold Silver Ratio: 65.20
Change: 1.023 or 1.6%

Dow Industrial: 8,284.89
Change: -184.22 or -2.2%

US Dollar Index: 82.57
Change: 0.27 or 0.3%

Confusion reigned in the metals markets today: platinum and palladium prices dropped, the silver price dropped, and the gold price rose. Gold edged up US$2.00 to US$925.50 but silver fell 19.5 cents to $14.00.

The Gold Price clearly is trying to fight its way through $928, but is trudging through deep mud. Silver closed at $14.00, holding that level at least. Both metals are at the top of their trading range. If they can't break through to higher ground now, they will fall back toward the bottom of the range. That's why $928 and $14.50 are so important.

Most every dealer I talk to reports very light business. Gold and Silver have traded back and forth over this region so often that they have eaten up people who are willing to buy or sell at these levels. Therefore they have to either drop or breakout upside before the business picks up again.

Stocks took another smack in the jaw today. The Dow dropped 106.41 to 8,362.70 and the S&P500 dropped 11.4 to 896.95. Dow may be beginning to roll over.

US DOLLAR INDEX chart looks terrible -- sick, and liable to get sicker. It closed up today, 26.7 basis points, to 82.573.

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

- Franklin Sanders, The Moneychanger

© 2009, The Moneychanger. May not be republished in any form, including electronically, without our express permission.

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.