Thursday, April 08, 2010

Gold Price Looks a Mite Winded.

Gold Price Close Today : 1152.50
Change: -0.1 or -0.0%

Silver Price Close Today : 18.116
Change -6.9 cents or -0.4%

Platinum Price Close Today: 1714.00
Change: 8.50 or 0.5%

Palladium Price Close Today: 506.25
Change: -1.65 or -0.3%

Gold Silver Ratio Today: 63.62
Change: 0.236 or 0.4%

Dow Industrial: 10,927.07
Change: 29.55 or 0.3%

US Dollar Index: 81.54
Change: 0.09 or 0.1%

The Dow found friends about noon-thirty and climbed to recoup about 2/3 of yesterday's loss. Hmmmmm. Now 10,940 is the line to beat and 10,840 the line to hold. The Dow might still surprise and turn up to touch 11,000 once before sinking beneath the waves, but odds favour that we have already seen the top. Dow closed today 10,927.07 up. S&P500 wowed the world with a 3.99 rise to 1,186.44.

Dow In Gold Dollars keeps on slipping, today to G$195.50 (9.457 oz). Any break below G$193.00 (9.336 oz) sends the Dow shooting down the chute.

US DOLLAR INDEX five day chart is so choppy that it's hard to parse. However, a rise to a new high for the move today -- 81.907 up 46.4 basis points -- with a lower close -- 81.535, up only 9.2 bps -- doesn't show much muscle. The dollar remains in a correction within an uptrend. Barring a close above 82.24, expect lower prices tomorrow or next week. We will find out whether this is the end of the dollar rally when the dollar meets what ought to be support at 79.50 - 79.00.

Another equivocal day for metals. The GOLD PRICE closed on the Comex down a gigantic dime to $1,152.20, leaving behind a double top on the 5-day chart. Gold might correct down to $1,138, even $1,130 before the rally begins again in earnest. Gold Price looks a mite winded. However, moving above $1,155 would nix all that and carry gold higher immediately.

SILVER'S chart is not even as straightforward as gold's, and gold's is pretty mysterious. Here's a guess: tomorrow a rise toward 18.25, then lower Monday, even down to 17.80 and end of the correction. But whether that ensues or silver slips lower tomorrow, it shouldn't break 17.80 if it wants to remain in an uptrend. Closed today on Comex at 18.116, down 6.9c.

Only fact nagging me about the silver price -- and I am a professional worrier, remember -- is that premiums have softened on the way up. US 90% silver coin has fallen from 35c under spot (basis wholesale buy price) to 50c under spot while 100 oz. name brand silver bars have given up 30c an ounce from 65c over spot to 35c (basis wholesale sell price). Softening premiums sometimes go hand in hand with topping markets.

Any silver close above 18.25 will send silver rocketing toward $19.50.

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.