Wednesday, March 10, 2010

Gold Price is Near the Bottom of the Range

Gold Price Close Today : 1107.80
Change: -14.20 or -1.3%

Silver Price Close Today : 16.994
Change -32.4 cents or -1.9%

Platinum Price Close Today: 1588.30
Change: -8.70 or -0.5%

Palladium Price Close Today: 463.75
Change: -6.25 or -1.3%

Gold Silver Ratio Today: 65.19
Change: 0.400 or 0.6%

Dow Industrial: 10,567.33
Change: 2.95 or 0.0%

US Dollar Index: 80.46
Change: -0.13 or -0.2%

Gold's spike downward yesterday was a false signal since it climbed for half the day today, then deflated like a balloon from $1,125 to $1,105 and lay there flat. Friend of mine on the floor of the Chicago commodity exchange said that the big funds suddenly sold in large numbers, pushing down the market. Could be.

Just like y'all, I'm watching to see whether the GOLD PRICE will hold $1,100 support. If not, gold re-visits $1,090. Yet forget ye not gold must climb over $1,125 to turn up again, that is, to change the trend from down to up. I reckon gold is paying this week for its party last week. 'Tis near the bottom of the range, you have to close your eyes, suck in your gut, and buy some.

Today the SILVER PRICE behaved much like gold, only more so: it V-bopttomed yesterday, climbed till noon all the way to $17.64, then simply plunged straight down to $16.95.
Comex close at $16.994 was cosmetic since it is trading at $17.04 in the aftermarket. ("Cosmetic" means somebody was putting make-up on the close, 6/10c to make it look worse, or maybe I've been studying the yankee government so long that I've become paranoid.)

So now we have this double bottom at $16.90. Will it hold? The market will make that plain on the morrow. If silver stays above $17.00, I would buy some. It could still drop all the way to $16.40 without breaking the uptrend line demarcated since early February.

I re-iterate that I believe we have already seen the after-December lows.

The scabrous US DOLLAR index (I am working hard on a synonym for "scrofulous") double topped yesterday and today at 80.80, then, having lost its wind altogether, collapsed to a low of 80.313. By now it has only slightly recovered to 80l.459, down only 13.3 basis points. That little change doesn't really tell the same tale as the five day chart.

For the nonce 80.10 offers support, and yet stubborner support awaits at 79.60, which will likely see soon since the $ has established a short term downtrend. I have not a clue what hit the dollar today, but it didn't help anything else much, either.

Although the Dow today rose a magnificent 2.95 points to close at 10,567.33 and the S&P 500 rose 5.16 to 1,145.61, look at the chart. You will discover there only indecision and tentativeness.

Monday I stood by while Susan had an echo-cardiogram, an ultrasound for the heart. Susan says her heart valves are "clapping hands" because that's what they look like. Whoa! Then you stagger and reel back recognizing that in your own chest every day of your life your own heart sings without ceasing a song of praise to God, and every man's chest rings with the same unbroken psalm, will-he, nill-he. God runs the whole universe like that, with crazy, reckless generosity, upholding all things by the word of his power and throwing out miracles and blessing with both hands, while we are so used to it all that we no longer know to call it a miracle.

At least Susan's heart valve repaired back in August 2008 is still clapping its hands, but her heart has a "junctional" rhythm. Her cardiologist wants to put in a pacemaker but brave, stubborn Susan, a very sparing consumer of medical and pharmaceutical products, begged off 90 days to try to straighten her heart rhythm out with supplements.

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. Whenever I write "Stay out of stocks" readers inevitably ask, "Do you mean precious metals mining stocks, too?" No, I don't.