Thursday, July 15, 2010

Lower Silver and Gold Prices are Expected

Gold Price Close Today : 1206.80
Change : -6.50 or -0.5%

Silver Price Close Today : 18.274
Change : 3.7 cents or 0.2%

Platinum Price Close Today : 1529.50
Change : 5.70 or 0.4%

Palladium Price Close Today : 465.50
Change : 0.00 or 0.0%

Gold Silver Ratio Today : 66.04
Change : -0.490 or -0.7%

Dow Industrial : 10,286.12
Change : -80.60 or -0.8%

US Dollar Index : 82.51
Change : -0.91 or -1.1%

This afternoon I have to leave early for an appointment, so I am sending this before the stock markets close.

The GOLD PRICE today peaked at $1,216.50, knocking again on that $1,218 door but the door did not open. That marks three failed tries at $1,218, plus yesterday's quasi-island reversal. Although the gold price held on at $1,203.70, the triple top at $1,218 and yesterday's weird island point to lower prices. Only way gold could negate that outlook is to smash through $1,218.
Comex gold closed at $1,208.10, up 1.30.

The SILVER PRICE rose, also, up 7,2c to $18.346. Chart differs from gold's. Silver has made two, not three, attempts to break overhead resistance at $18.50, one yesterday (the weird island) and one today. Low today was $18.1464. It is dangerous to ignore implications of chart patterns, so I have to keep on expecting lower prices unless the silver price can burst through $18.50.

STOCKS have laboured all day to stay above 120 points below yesterday. The reached as high as 45 points down, but in last few moments have traded down to 10,286.12, down 80.6 points or 0.78%. This feels like a market that has turned. The peak for this move has most likely been posted, and big drops are coming. S&P is down 8.01 at 1,087.15, down 0.73%.

US DOLLAR INDEX lost a massive 91.4 basis points today, down 1.18% to 82.512. Euro climbed to $1.299, up 1.17%.

One trap about markets is that just about the time the outlook looks most hopeless is the time the market is about to turn around. Dollar has been sinking a long time without relief. Today might be the last washout, since at 82.512 it has nearly reached my 82.25 - 82.00 target. If the dollar drops further, something bad is brewing behind the scenes.

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

- Franklin Sanders, The Moneychanger

© 2010, 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.