Tuesday, October 13, 2009

Today's Gold Price Action Formed an Equilateral Triangle, Which Tomorrow Could Break Out Up or Down

Gold Price Close Today : 1064.20
Change: 7.50 or 0.7%

Silver Price Close Today : 17.805
Change: 2.0 or 0.1%

Platinum Price Close Today: 1352.00
Change: 13.40 or 1.0%

Palladium Price Close Today: 329.80
Change: 0.00 or 0.0%

Gold Silver Ratio Today: 59.70
Change: 0.420 or 0.7%

Dow Industrial: 9,871.06
Change: -14.74 or -0.1%

US Dollar Index: 75.77
Change: -0.36 or -0.5%

GOLD's five day chart shows a perfect uptrend line, anchored on $1,045 lows last Thursday and Friday. Today's action formed an equilateral triangle, which tomorrow could break out up or down. Again, the existing uptrend makes the upside more likely. The GOLD PRICE closed on Comex at $1,064.20, up $7.50.

'Twas a turbulent day for the SILVER PRICE, rising to $18.02, then getting slapped back to $17.54, yet closing Comex up 2 cents at $17.825. $17.50 is now key support.

Bull markets always climb a wall of worry, says the proverb, so here I go. Silver's trouble piercing $18.00 might amount to nothing more than a usual "two tries to break strong resistance." Then again, it non-confirms gold's strong performance piercing $1,060 resistance today. Metals' advance begins to feel a bit sluggish, heavy-footed. Strong silver performance tomorrow would vaporize my worry.

DOW IN GOLD DOLLARS today dropped to a new low. Even if hard days lie ahead of us, as metals investors we'll be better off than those in stocks.

The US DOLLAR INDEX broke 75.90, even 75.80 today (low was 75.738) but did not collapse as I expected. Either the dollar found "sponsorship" from the Nice Government Men or some unbelievably brave contrarians, or the buck has now found new feet at 75.80. Course,it must hold that level tomorrow. The "Trend in force" rule leads me to expect further fall.

STOCKS: Today the Dow couldn't make any headway and got punished for trying. Performances reversed today with the Dow & S&P 500 barely down and the Nasdaq Comp barely up (+0.75 to 2,139.89). Dow closed down 14.75 at 9,871.06 and S&P down 3 at 1,073.19. All this bespeaks confusion and indecision. Yesterday the Dow reached the nosebleed limit of its September highs and high for the rally from spring. Must now fish or cut bait, advance or die. Clear 9,900 or collapse. Probably will climb a bit more, since the Bear wants to entice the most victims possible into
his cave for mauling.

Starting the day with welcome news, my granddaughter Caroline's surgery went very well. Surgeon found he could operate on vessels to her lungs alone, so didn't have to operate on her heart. Small hole in heart will heal itself or can be fixed by catheter when she's a teenager. Surgery was much quicker than expected, and she is doing very well. Thanks and praise be to God, and thanks to all you who prayed for Caroline. Don't stop!

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.