Sunday, September 26, 2010

Hold on to Your Silver and Gold - If You Have no Silver or Gold Yet, Buy

Gold Price Close Today : 1,296.00
Gold Price Close 17-Sep : 1,275.60
Change : 20.40 or 1.6%

Silver Price Close Today : 2138.3
Silver Price Close 17-Sep : 2079
Change : 59.30 or 2.9%

Platinum Price Close Today : 1,641.50
Platinum Price Close 17-Sep : 1,609.60
Change : 31.90 or 2.0%

Palladium Price Close Today : 559.70
Palladium Price Close 17-Sep : 547.90
Change : 11.80 or 2.2%

Gold Silver Ratio Today : 60.61
Gold Silver Ratio 17-Sep : 61.36
Change : -0.75 or -1.2%

Dow Industrial : 10,860.26
Dow Industrial 17-Sep : 10,607.85
Change : 252.41 or 2.4%

US Dollar Index : 79.282
US Dollar Index 17-Sep : 81.428
Change : -2.15 or -2.6%

I've just returned from a long trip, but wanted to take this chance late Saturday afternoon to update y'all on this week's works and prices.

Both silver and gold are locked into a very strange uptrend. Both are overbought, both refuse to flinch, both keep making all time new highs. Ratio dropped Friday to 60.36. Silver is roaring, way past 2100c at 2138.3c and eyeing 2200c. Gold can sneeze on $1,300 from here. Friday on comex silver closed at 2138.3, up 18.9c while gold made another all time high at $1,296, up $1.70.

This sort of run is rare and unpredictable, and liable to stop any time. However, if gold clears $1,300, the next target implied is $1,375, a target I have long expected. Silver? Silver? Well, above the 2008 high at 2068c, why, "how high" is anybody's guess.

What befuddles me is that stocks are moving right along with silver and gold. Why? Maybe people perceive them as a refuge from the puking-sick dollar. Whatever their thinking, it is wrong. The economy will take care of stocks, and that right soon. Stay away from stocks, stay away. Picture my long bony finger in your face as I say that, and take it to heart.

Yet when stocks correct their fall will also burden silver. Hard for me to avoid picturing a little further rise, then a correction of 3-4 weeks for metals, and then a further rise either into January-February 2011 or spring 2011, that latter rise carrying gold to $1,600 and silver to 3370c.

Right -- I know it sounds crazy, but that's a bull market for you.
The US DOLLAR INDEX simply cannot get well. Friday it closed at 79.282, down 80.4 basis points, a huge move that carries it down 215 basis points (2.6%) for the week. Not too oddly, that's about the same percentage that stocks rose for the week.

Hold on to your silver and gold. If you have no silver or gold yet, buy. Watch out for stocks, a time bomb that has already gone "Tock." Dollar index is headed much lower, so you'd be better off taking your chances with silver or gold than with the buck.

Y'all enjoy your weekend. Argentums et aurum comparanda sunt --

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.