Thursday, October 28, 2010

Stop waiting - Time to buy Gold and Silver, Assuming Silver and Gold Prices Follow Through Tomorrow

Gold Price Close Today : 1342.10
Change : 19.90 or 1.5%

Silver Price Close Today : 23.871
Change : 0.471 cents or 2.0%

Gold Silver Ratio Today : 56.22
Change : -0.281 or -0.5%

Silver Gold Ratio Today : 0.01779
Change : 0.000089 or 0.5%

Platinum Price Close Today : 1692.70
Change : 17.00 or 1.0%

Palladium Price Close Today : 629.25
Change : 12.10 or 2.0%

S&P 500 : 1,183.78
Change : 1.33 or 0.1%

Dow In GOLD$ : $171.18
Change : $ (2.75) or -1.6%

Dow in GOLD oz : 8.281
Change : -0.133 or -1.6%

Dow in SILVER oz : 462.79
Change : -3.40 or -0.7%

Dow Industrial : 11,113.95
Change : -12.33 or -0.1%

US Dollar Index : 77.29

Change : -0.861 or -1.1%

I couldn't get SILVER or GOLD right today, either. Saw them rising, waited till they convinced me they really had turned around, and managed to buy near the day's high. Good work, Moneychanger.

Five day GOLD PRICE chart appears to have formed most of an upside-down head and shoulders, with the left shouder bottoming Tuesday at $1,328, the head troughing yesterday just under $1,320, and a rise today back to the neckline about $1,345. If that's an accurate reading, tomorrow gold will dip to form the right shoulder, bottoming about $1,330, maybe $1,335. Next week or tomorrow it will climb back up to the neckline. Then 'twill break through and leave everybody in the dust like when the bell rings at the Kentucky Derby.

The GOLD PRICE rose 19.90 to close Comex at $1,342.10. It will take a close below $1,320 to turn gold down.

The SILVER PRICE 5-day chart does not mirror gold's. Rather, silver has established an uptrend and day by day keeps validating that uptrend line. However, resistance at 2400c stopped silver today. Comex settled silver at at 2387.1c, up 47.1c. Silver's Tuesday peak at 2420c presents the next hurdle. I think we have seen the bototm of the move. Y'all will know I'm dead-wrong if silver closes below 2320c, because that event would turn the trend down.

Stop waiting. Time to buy, assuming the SILVER PRICE and the GOLD PRICE follow through tomorrow.

These are markets that will slice your throat and grin at you while waiting for your head to topple off your shoulders. Be careful.

After yesterday's bold start the dollar index fell 86.1 basis points to 77.288 right now, a loss of 1.11%. Goodness, I understand that the rally from Monday was complete and a correction must follow, but the dollar gave up most of its gains. That is a full 62% of the foregoing gain.

Anyhow, let's ponder this mess. The dollar has established support around 72.20, so as long as it can cling to life above that point, it can continue to "rally". A close below that point makes the dollar doubtful, a close below 76.70 makes the dollar doomed. Expect it to continue its teasing rally.

I don't care how many times the Nice Government Men goose the stock market, they can't hide a trend and they cannot succeed against a primary downtrend. The Dow peaked Monday on the 5-day chart around 11,250, and since then has made a series of lower lows and lower highs, which, definitionally and mathematically, constitutes a "downtrend." Have y'all observed how every day the Dow erodes a bit more? Tomorrow don't expect it to beat 11,150, but a bottom number is wide open. Today the Dow closed at 11,113.95, down 12.33, up off the day's low by 62 points but still lower for the day. Did I mention that most of that gain came near closing time? How forgetful I am. S&P500 closed up 1.33 at 1,183.78.

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.