Tuesday, March 23, 2010

Tomorrow Ought to be a Better, Higher Day for Gold, On Its Way to Challenge That Resistance at $1,125 Again

Gold Price Close Today : 1103.50
Change: 4.20 or 0.4%

Silver Price Close Today : 17.012
Change 0.92 cents or 0.5%

Platinum Price Close Today: 1606.70
Change: 10.20 or 0.6%

Palladium Price Close Today: 464.50
Change: 7.50 or 1.6%

Gold Silver Ratio Today: 64.87
Change: -0.104 or -0.2%

Dow Industrial: 10,870.76
Change: 84.87 or 0.8%

US Dollar Index: 80.82
Change: 0.17 or 0.2%

Yesterday's GOLD PRICE weakness pushed the Dow In Gold Dollars (DiG$) barely through G$200 resistance that has so long blocked the DiG$ path. Today it fell back to G$203.64 (9.851 oz), still barely above resistance. The DiG$ is signalling either (1) stocks are about to soar and the gold price to plummet, or (2) stocks are very close to their peak and the gold price to its bottom. No need to enunciate for y'all which side of that conundrum I come down on. In truth, it begs that sort of faith that believes in politicians' integrity to believe that the DiG$, locked as it has been since August 1999 in a primary downtrend, will now stage a major rally. Especially not after that long rally from the March 2009 low.

Recall that yesterday the gold price eeked out a spike bottom low. Well, today it gave an encore performance, but a slightly higher low, and it closed above $1,100 -- not by much, but some, namely up $4.20 to $1,103.50. Now even the naïve and inexperienced could look at gold's five day chart and perceive that double bottom. Unless gold closed below $1,100, tomorrow ought to be an better, higher day for gold, on its way to challenge that resistance at $1,125 again. Last few day's trading does not yet gainsay my working interpretation that we have the gold low behind us in February at $1,044.80 (intraday). I continue to buy on these weak days.

The SILVER PRICE, believe it or not, remaineth above its 20 day moving average ($16.99), and closed today on Comex up 9.2c at $17.012c. Clearly that $17.00 has become the battlefield where silver's fate will be decided. Like gold's five day chart, silver's shows a double bottom that looks quite firm. Assuming that $16.92 holds, silver will keep on climbing.

Now y'all might hardly credit this, but the scrofulous US dollar Index hath carved out a double top, yesterday and today at 81.10-ish. So unless the disgusting dollar can close above 81.10, it will turn down again, and down means bouncing back to support at 80.20. Still in an mid-term uptrend, but wavering, sickening, leaning its head over the rail and liable to fall overboard.

Dow Jones Industrials rose again today 84.87 points to 10,779.76, probably on its way to next resistance and propaganda coup at 11,100. S&P rose 6.90 to 1,172.71. Friends, this is all wet cardboard, made to look like a strong economy with plenty of NGM money to prop it up. Trouble is that when you get close and poke with your finger, it punches right through. Stay out of stocks, for your capital's sake.

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.