Monday, November 15, 2010

The Gold Price Has Plenty of Support Around $1,355 I'll Buy Again at $1,375

Gold Price Close Today : 1368.40
Change : 3.00 or 0.2%

Silver Price Close Today : 26.088
Change : 0.150 cents or 0.6%

Gold Silver Ratio Today : 52.45
Change : -0.188 or -0.4%

Silver Gold Ratio Today : 0.01906
Change : 0.000068 or 0.4%

Platinum Price Close Today : 1669.50
Change : -11.20 or -0.7%

Palladium Price Close Today : 668.50
Change : -7.00 or -1.0%

S&P 500 : 1,199.21
Change : -14.33 or -1.2%

Dow In GOLD$ : $169.08
Change : $ (1.72) or -1.0%

Dow in GOLD oz : 8.179
Change : -0.083 or -1.0%

Dow in SILVER oz : 429.03
Change : -3.49 or -0.8%

Dow Industrial : 11,192.58
Change : -90.52 or -0.8%

US Dollar Index : 78.62
Change : 0.566 or 0.7%

This morning the SILVER PRICE and the GOLD PRICE were up slightly over Friday. I glanced away and looked back and LO! Silver had jumped 20 cents. I looked at the overnight/over the weekend charts for silver and gold, and both appeared to have completed a downmove on Friday and traded sideways into this morning. Both appeared to be bursting for a run. I bought, expecting we had seen the last of correction.

We hadn't.

They peaked about noon Eastern time, then edged downward into the closes. When Comex closed silver had risen 15c from Friday to 2608.8c and gold had climbed $3.00 to $1,368.40. That wasn't much below my shopping basket ride at 2637.5 and 1371.30.

Then the SILVER and GOLD PRICE simply fainted, plump! Gold fell as low as $1,355.90 and silver to 2540c. Both have since recovered, silver to 2573c now and gold to $1,362.

What next? The main defense now is $1,355 and 2540c, but, heaven help me, that looks like the bottom of it. Either I misread the chart and got hit by one more leg down, or tomorrow those support levels will be broken and silver and gold will make one more move earthward. Gold has plenty of support around $1,355, but if that falters then you have to reckon with $1,330 or $1,315. Silver has solid support at 2500c - 2490c, a mere 40c below today's lows. Could see that tomorrow.

Natural born durned fool that I am, if I come in here tomorrow and silver's above 2550c and gold over $1,375, I'll buy 'em again!

However it turns out, I cling to my opinion that this entire correction from 9 November will not belong to the gigantic species but the midget, and is on the road to $1,600.

I can't work up any enthusiasm for talking about stocks. They just stink. Dow today gained a silly 9.39 to 11,201.97 while the S&P500 dropped 1.46 to 1,197.75. Nasdaq Comp was down, along with the Nasdaq 100. It was a sloppy, messy day, accomplishing nothing to gainsay their established downtrend.

DOLLAR INDEX today rose 56.6 basis points to 78.615. Euro dropped a US penny. Dollar index hath not reached its 50 dma (78.62) and must decide whether 'twill fish or cut bait. Looks like it wants to move higher.

This is just a short term rally, my eyes say. Also, I've been ruminating and chewing on what Bozo Ben has in mind, and considering that he is a student of the Great Depression and an unrepentant Keynesian. That implies he has looked at Roosevelt's 41% devaluation of the US dollar (over a year) and come to a typically moronic Keynesian conclusion. After the devaluation, in 1937-38, the stock market crashed worse than 1929, and the Depression dragged on and on. What will Bonzo Ben Super-Keynesian conclude? "Roosevelt failed because he didn't devalue enough. Therefore I, Ben the Beneficient, will do what The Great Prevaricator could not do, I will depreciate even more and make it work."

No, I haven't been a fly on his wall, but I'll bet a dead dog to a possum that's where he's headed. If I've rightly read his mind, all y'all without any silver or gold had better flee now to Mexico, where you'll come a lot nearer finding a job than you will in the US of A a twelvemonth hence.

On this day in 1777 the Continental Congress approved the Articles of Confederation after 16 months of debate. In spite of what all the constitution worshippers say, the Articles government was far superior to the constitution at preserving both federalism and individual rights. Patrick Henry warned everybody during the ratification debates, y'all are giving up both the power of the sword and the power of the purse to a central government, and those are the only two powers worth having. Not enough listened.

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.