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Friday, July 30, 2010

As Long as $1,180 Holds, the Gold Price Will Advance or Move Sideways Into August

Gold Price Close Today : 1,181.70
Gold Price Close 23-Jul : 1,187.70
Change : -6.00 or -0.5%

Silver Price Close Today : 1798.7
Silver Price Close 23-Jul : 1809.6
Change : -10.90 or -0.6%

Platinum Price Close Today : 1,573.70
Platinum Price Close 23-Jul : 1,546.00
Change : 27.70 or 1.8%

Palladium Price Close Today : 497.50
Palladium Price Close 23-Jul : 470.00
Change : 27.50 or 5.9%

Gold Silver Ratio Today : 65.70
Gold Silver Ratio 23-Jul : 65.63
Change : 0.06 or 0.1%

Dow Industrial : 10,465.94
Dow Industrial 23-Jul : 10,412.74
Change : 53.20 or 0.5%

US Dollar Index : 81.537
US Dollar Index 23-Jul : 82.664
Change : -1.13 or -1.4%

This week probably saw upside reversals in SILVER and GOLD PRICES and a downside reversal in stocks, and an upside reversal in the US dollar index.

On the five-day chart the GOLD PRICE has traced out a shallow upside down head and head and shoulders Tuesday-Wednesday-Thursday. Today gold confirmed that by rising over $1,170 and closing above $1,180, where it had broken down on Tuesday. As long as $1,180 holds, the gold price will advance or move sideways into August. Expect no big moves until mid-August. The damage done to gold market morale by July can only be undone by rising above $1,225. MACD turned up today.

Since the gold price now appears to have bottomed it makes little sense to wait for it to visit lower prices, since that probably won't happen. Go ahead and start buying it. Gold closed on Comex today at $1,181.70, up $13.30.

Today's picture for the SILVER PRICE is not quite identical to gold's. If silver had closed above $18.00, that would have been wholly unequivocal. However, silver closed on Comex up 38.6c at $17.987. Close enough, perhaps, for government work. In the aftermarket it's trading at $18.02 - $18.06.

If silver holds above $17.90 on Monday, go ahead and buy some.

The US DOLLAR INDEX feebly sought to rally today, and rose to within inches of 82, only to be slapped soundly back into its place. From yesterday it fell 10.4 basis points to 81.537. By small margin over yesterday the dollar made a new low for the move today. Presently 81.45 is support. The dollar could be rounding out a bottom, but that may not be completed until it hits the 200 DMA at 80.52. A close above 82, then 83.5 confirms a rally in progress. If the dollar is not bottoming, then woe awaits the dollar! But I believe some sort of dollar rally will soon materialize.

When you put make-up on a pig and a gold ring in her snout, what do you have? A pig, still. No amount of prettifying changes a pig into a partridge or a peacock or a pretty woman. So also, no amount of tape-painting by the Nice Government Men and their yellow cur dog lackeys can make a rotten investment locked in a primary downtrend -- stocks -- into a wise and profitable investment.

For two days stocks have oscillated around unchanged, spending most of the day below unchanged, failing over and over at unchanged, and then closing "higher" by pennies. Friends, this is no gain. This is a stalled market at its last high, having double topped Monday and Thursday. Stocks look like Wile E. Coyote in the Roadrunner cartoons when he runs off the edge of a cliff and hovers that single instance of recognition before plunging into the abyss below. Today the Dow closed 10,465.94, down 1.22 and the S&P500 closed up 0.07 at 1,101.60.

Stay away from stocks.

Many thanks to all you readers who kindly sent condolences on the passing of Susan's mother.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Thursday, July 29, 2010

If the Gold Price Did Not Make its Final Bottom on 27 July, Then it Will Head for the 200 DMA at $1,145.70

Gold Price Close Today : 1168.40
Change : 8.00 or 0.7%

Silver Price Close Today : 17.601
Change : 0.178 cents or 1.0%

Platinum Price Close Today : 1561.10
Change : or 0.0%

Palladium Price Close Today : 486.75
Change : or 0.0%

Gold Silver Ratio Today : 66.38
Change : -0.219 or -0.3%

Dow Industrial : 10,467.16
Change : -2.60 or 0.0%

US Dollar Index : 81.63
Change : -0.55 or -0.7%

Monday I was working in such a blind heat trying to get out of here and over to Memphis that I botched my announcement terribly. Our friend Stan Poston passed away Saturday, and we were planning on his funeral Monday Morning, when on Sunday we learned that Susan's mother had unexpectedly died, peacefully in her sleep, on Saturday as well. She was 90 and still lived alone and drove her own car. She was a wonderful Christian woman, mother of six children, full of grace and love. "Right dear in the sight of the Lord is the death of his saints."

The US DOLLAR INDEX has looked sorry all this week, but seems to be trying to turn up, even though today it made a new low for the move at 81.63, down 55 basis points. Next target, if it is not yet turning, is the 200 DMA at 80.49. Surely it ought to rally off that, even if only a dead cat bounce.

STOCKS appear to have baffled me, remaining in the 10,450 range. I give not a hoot. I wouldn't buy stocks with your money, and those who fall into this trap will follow it -- with their money -- into a bottomless pit. Today the Dow closed down 2.16 at 10,467.16 and S&P 500 closed at 1,101.53, down 4.6.

Tuesday the GOLD PRICE broke $1,180 support and repeated the same curious pattern we've seen over and over in gold and silver lately: instantaneous straight up or down rises and drops that then trade dead sideways. Very thin markets dominated by traders and stop orders, looks like.

My $1,165 gold target has been fulfilled and exceeded. Look at these closes: 26 July, $1,183.10, - $4.70 27 July, $1,158.00, down 25.10 (low $1,155.90) 28 July $1,160.40, up $2.00 29 July, $1,168.40, up $8.00

If the gold price did not make its final bottom on 27 July, then it will head for the 200 DMA at $1,145.70, or maybe the round number $1,150. RSI has turned up but not the MACD, although a non-confirmation of the lower prices is beginning to show there.

Had I been here yesterday I would have bought gold. Look now for a little dip back toward $1,160 - $1,150 and buy there. I bought some today, because I don't much believe it will re-visit $1,160, and gold above $1,170 would be a buy because it would be an upside breakout.

SILVER's chart might well be a carbon copy of gold's. Straight down, instantaneous drop from 1810c to 1760c, lower low with a spike bottom yesterday, then slightly higher today. 26 July, 1819.5c, up 9.9c 27 July, 1762c, down 57.5c 28 July, 1742.3c, down 19.67c 29 July 1760.1c, up 17.8c.

As with gold, the bottom came Wednesday with a spike to 1730c. 200 DMA stands at 1767c, so that touchback is fulfilled. Silver must hold 1722c. Buy on any backup to 1750c, or breakout above 1770c.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Friday, July 23, 2010

Keep on Buying Gold on Any Gold Price Weakness

Gold Price Close Today : 1,187.70
Gold Price Close 16-Jul : 1,188.00
Change : -0.30 or 0.0%

Silver Price Close Today : 1809.6
Silver Price Close 16-Jul : 1777.3
Change : 32.30 or 1.8%

Platinum Price Close Today : 1,546.00
Platinum Price Close 16-Jul : 1,515.30
Change : 30.70 or 2.0%

Palladium Price Close Today : 470.00
Palladium Price Close 16-Jul : 453.35
Change : 16.65 or 3.7%

Gold Silver Ratio Today : 65.63
Gold Silver Ratio 16-Jul : 66.84
Change : -1.21 or -1.8%

Dow Industrial : 10,412.74
Dow Industrial 16-Jul : 10,097.90
Change : 314.84 or 3.1%

US Dollar Index : 82.664
US Dollar Index 16-Jul : 82.577
Change : 0.09 or 0.1%

Life is not going to be easy for the next few weeks.

The prices above are for 1:00 p.m., because I must leave early today. The US DOLLAR INDEX acted as if it would finally rally this week, only to lose all gas at 83.40 and faint back toward 82.20. As long as it remains above 82.20 there remains the chance of some rally, at least.

STOCKS have reached their previous high, but rejoice not, O ye permastockbulls! That's called a "double top." Big downside is about to hit stocks, great mourning and wailing and gnashing of teeth! Stay out of stocks.

Yesterday it appeared that gold and silver had probably bottomed, but today gold dropped 7.80 to close at $1,187.70. Bottom support here stands about 1,175, then 1,185. Silver closed down only 1.9c at 1809.6. Clearly, somebody doesn't agree on direction, but which one?

I stick with my opinion that silver and gold made their bottom this week, but until gold climbs above $1,225 and silver above 1850c, that's no more than my opinion.

Most emphatically I do NOT expect silver and gold to make new lows for the year. Greatest likelihood is frustrating sideways movement between now and mid to end August, then the climb begins. Note that the June $1,257 high was NOT the end of the movement, only the end of one stage of the rally. The end of that rally is $1,400 or more, and silver at -- I know it sounds outrageous -- 2900c or more.

Keep on buying silver and gold on any price weakness.

Dear Readers, I asked y'all not long ago to pray for my dear friend Stan Poston, who has brain cancer. His symptoms have gretly accelerated, and I don't believe he can live much longer. Please pray for him and his family.

Y'all enjoy your weekend!

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Thursday, July 22, 2010

Gold Price is Trying to Turn Up

Gold Price Close Today : 1191.60
Change : 0.10 or 0.0%

Silver Price Close Today : 17.798
Change : 0.113 cents or 0.6%

Platinum Price Close Today : 1525.80
Change : 8.50 or 0.6%

Palladium Price Close Today : 458.05
Change : 11.00 or 2.5%

Gold Silver Ratio Today : 66.95
Change : -0.422 or -0.6%

Dow Industrial : 1,093.60
Change : 24.05 or 2.2%

US Dollar Index : 82.60
Change : -0.79 or -0.9%

While 1790c had been firm resistance, today silver burst through that level, clean straight up from 1780c to 1818c in thirty minutes. After 10:00 EDT it traded sideways, vibrating around 1810c. Odd chart, caused by what? Thinness of market? Certainly, strong demand. Makes me ponder silver's behaviour, how it so often makes outrageous, demoralizing falls, then roars back while nobody is looking. If silver can remain above 1800c, silver may be riding that mode. Comex silver closed today up 31.7c at 1811.5c. Mark that the 20 day moving average right now standeth at 1817c.

Today's gold chart has a Heron Head like silver's. Between 9:30 and 10:00 EDT gold blasted through 1190 resistance to $1200, then rested on $1,195 the rest of the day. Gold is trying to turn up. Twenty day moving average stands about $1,212.50, so that will be the first confirmation gold has turned up. Close over $1,225 removes all doubt.
Operating assumption until market contradicts is that silver and gold have bottomed and kissed back. Close below recent lows would be necessary to gainsay this.

Good economic news out of Euroland today sent the Euro up a bit to $1.2886, while the dollar, at the other end of the teeter-totter, dropped 79 basis points to 82.602. Alas, the dollar had a good start on what promised to be at least a counter-trend rally, but today whacked it back from the 83.40 hurdle nearly to where it began. Critical support is 82.20, versus today's low at 82.462. A rally is not yet ruled out, since this might constitute no more than a final kiss good bye to support. Naturally, if the dollar breaks 82.20 tomorrow, that imports a greater fall, maybe to the 200 DMA at 80.33.

Strong earnings reports goosed Wall Street today. Dow gained 201.77 points (1.99%) to 10,322.30. S&P500 added 2.25% (24.05 points) to 1,093.60. Look back at the record and you will discover that since May the Dow has crossed back and forth over this ground like those Hare Krishna teams used to dance back and forth over an airport lobby. Yet with what result? None. No advance, but plenty of retreat, burning your friends and their buying power along the way. Stay away from stocks. They will shortly find the cliff's edge. Today's rally merely brought them close to their 200 DMA at 10,391. Look at the longer chart: the trend is firmly earthward.

I have now lost count of all the emails, hysterical and otherwise, I have received about the "new tax on silver and gold" that was slipped into the Obamacare bill.

WHOA. Stop. It is nothing of the kind, and in truth is MUCH worse than a mere tax on silver and gold.

Here's what actually is happening. Section 9006 of the hilariously mis-named Patient Protection and Affordable Care Act amends the Internal Revenue Code to expand the applicability of Form 1099, but does not impose any new tax.

Currently 1099 forms are used to report miscellaneous "income" (another hilarious misnomer, which is misapplied to "revenue" to confuse the public) in the form of payments to independent contractors or the self-employed. Right, it is a method of government spying to determine how much revenue you have, which they call "income", so they can be sure they bleed as much as possible out of you, Turnip. Chances are you might sneak around and mow a yard for $20 without giving the government its fair share.

Currently the law supposedly requires businesses to issue a 1099 to any individual or unincorporated business paid more than $600 cumulative in any calendar year. Right, 30 payments of $20 qualifies. 1099s are not required to be issued to corporations, except incorporated law firms. (Maybe lawyers cheat on their taxes more than other people?)

So what's the change? Beginning 1 January 2012, not immediately, all payments over $600 allegedly must be reported on a 1099, including payments to corporations.
This is not a tax on silver and gold. Let me make this perfectly clear, as a person who has fought with IRS for 15 years, been indicted for conspiracy to defeat IRS operations, and wilful failure to file income tax returns and having been acquitted on the defense that the law contains no statute that makes anyone but foreign withholding agents liable to pay income tax: people who cheat on their income taxes are stupidly committing perjury. I will go to jail arguing with the government about whether I owe the tax or not, but I will not go to jail for lying about how much I owe.
If coin dealers and their customers are upset because the government is eliminating a way for them to cheat on income taxes they voluntarily pay, I have no sympathy for them. They sign returns under penalty of perjury.

This new reporting provision imposes NO new tax on silver and gold, none. If you are a person who is liable to pay income tax and you realize "income" when you sell silver or gold, you are ALREADY required to report the gain. This law changes nothing.
But this is the lighter and shallower question raised by this new 1099 requirement. The weightier consideration arises from the enormous accounting burden and cost it loads on small businesses. Every payment must be tracked by customer to make certain the total payments do not exceed $600. You probably pay your garbage man more than that every year. Will you send in a 1099 on him? Do you have his address and tax ID? Worse than that, payments to corporations were exempt from reporting, but must now be reported, a colossal increase in accounting labour.

As usual, the government piles stupidity upon stupidity. Apparently they haven't caught on that a depression is raging, and small businesses create more jobs than anyone else in the economy. Wouldn't it be a great idea right now to increase their costs by quintupling their accounting load? Well, I reckon it will create new accounting jobs - for a couple of months until the new costs shut businesses down all over the country.

But before everyone concedes the end of the world, ponder this. California Rep. Dan Lungren on 26 April last introduced legislation that would repeal this requirement. Look up HR 5141, Small Business Paperwork Mandate Elimination Act.
Finally, there are deeper questions still lurking here. Do all the folks upset by this latest tyranny not recognize already that we live under a financial police state? That a government that claims to be god must know and gather every fact about every person and transaction? After all, a god can't be a god unless he knows everything. What about the income tax itself? Why does the law contain no statute making anyone except foreign withholding agents liable for the tax? Why does everybody pay it then? Could the federal government actually have been collecting a tax for 97 years that doesn't exist in the law? Where are the emperor's clothes?

Listen: a little more 1099 reporting is the least of your worries, except that it will put hundreds of thousands of businesses, including coin dealers, out of business.
This new law changes nothing. It does NOT evidence an Obama plan to confiscate gold. It does NOT imply you shouldn't buy physical gold and silver -- just the opposite. It makes clearer than ever that the US government will drive the economy and the dollar into the ground. You will need the silver and gold in your own hands, and not another's.
Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Monday, July 19, 2010

Give Both Silver and Gold Prices a Couple of Days to Settle and Shake Off the Fear, then Begin Buying on Retreats

Gold Price Close Today : 1181.70
Change : 6.30 or 0.5%

Silver Price Close Today : 17.534
Change : -23.9 cents or -1.3%

Platinum Price Close Today : 1507.40
Change : -7.90 or -0.5%

Palladium Price Close Today : 445.70
Change : -7.65 or -1.7%

Gold Silver Ratio Today : 67.39
Change : 1.261 or 1.9%

Dow Industrial : 10,155.19
Change : 57.29 or 0.6%

US Dollar Index : 82.58
Change : -0.09 or -0.1%

Greatest hurdle in trading markets is to stop fooling yourself. We get bearish too late, and bullish too late, and so miss the turns. Right now seems a bit late to become too bearish on the metals. I'll explain below.

Although the US DOLLAR INDEX dropped today a tiny 7,6 basis points to 82.577, the small V-bottom from Friday remains unbroken. Dollar could rally at any moment, slapping the smugness out of all those long Euros. Euro rose 0.0041 to $1.2944.

My reading of the Dow in Gold Dollars on Friday may have been a bit unbaked, or let us save face and say "premature". DiG$could rally to G$183 (8.853 oz). What argues against that? Stocks are teetering on the edge of a cliff. It is a high cliff, and falling will bring pain galore. Stocks are hard to read when the 800 lb. government gorilla stands always ready to bend the outcome. Dow today rose 57.29 to 10,155.19, I reckon because it had gotten too sweating close to 10,000 for the Nice Government Men to abide S&P 500 rose 6.49 to 1,071.37.

SILVER pierced its 200 day moving average (1763.5c) with its Comex close at 1753.4c, down 23.9c. It followed through on Friday's embryonic breach of the February - March 2010 uptrend line. If the 200 DMA doesn't contain silver -- and often it doesn't -- then silver could fall to 1720c - 1710c where it encounters the uptrend line from the November 2008 low to the February 2010 low.

Awwww, silver's not as hopeless as it seems. The seasonal pattern calls for a low by this time in the year, rise into early fall, and low in October/November. But, lo! Be Warned! That seasonal pattern is a very rough yardstick, because the year's high sometimes comes in fall, and sometimes in spring, and sometimes in February.

Point is, silver ought to be near a low for the summer. Overbought/Oversold indicators (RSI & MACD) are mumbling out of both sides of their mouth, showing a relatively but not extremely oversold condition. To reach vastly oversold, silver would require a correction like July-November 2008 or December-February 2009, and I doubt that.

Silver may stumble and bounce along a bottom from here until mid-August when it begins rising into a fall high. On the other hand, it might decline into the fall for a November or December low and then rise into spring 2011. Mmmmmmm. I am trying, I'm trying, but I just can't picture silver finishing 2010 lower than it started. Since the bull market began in 2001, that has happened only once, in the wake of the 2008 financial panic.

The GOLD PRICE fell through $1,190 support by the time New York opened and then slid downhill till it reached a $1,178 low at 11:00. After an hour hovering around $1,180, it climbed to the low $1,180s. Comex gold closed at $1,181.70, down $6.30.

Gold has now reached the bottom boundary of the uptrend channel from November 2008. The worst correction since then, namely, Dec-Feb. 2010, did not fall out of this uptrend channel, & this is a correction of smaller degree. Possible targets are (1) this uptrend boundary, (2) $1,150 support, or (3) the 200 DMA ($1,139.46). That last is the most doubtful because gold doesn't tend to visit its 200 DMA as often as more volatile silver.

Give both silver and gold prices a couple of days to settle and shake off the fear, then begin buying on retreats. Buy at $1,180 (I assume tomorrow will see a small rise), then $1,150, then $1,140. Buy silver at 1750c & 1720c.

Remember the human tendency to wax bearish at bottoms and bullish at tops, and steel yourself.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Friday, July 16, 2010

The Gold Silver Ratio Presents Us with a Cliffhanger. Over 69.5 It Breaks Out Upside, Under 64.5 to the Downside.

Gold Price Close Today : 1,188.00
Gold Price Close 9-Jul : 1,209.60
Change : -21.60 or -1.8%

Silver Price Close Today : 17.773
Silver Price Close 9-Jul : 18.053
Change : 28c or -1.6%

Platinum Price Close Today : 1,064.88
Platinum Price Close 9-Jul : 1,530.80
Change : -465.92 or -30.4%

Palladium Price Close Today : 453.35
Palladium Price Close 9-Jul : 458.25
Change : -4.90 or -1.1%

Gold Silver Ratio Today : 66.84
Gold Silver Ratio 9-Jul : 67.00
Change : -0.16 or -0.2%

Dow Industrial : 10,097.90
Dow Industrial 9-Jul : 10,198.03
Change : -100.13 or -1.0%

US Dollar Index : 82.577
US Dollar Index 9-Jul : 83.986
Change : -1.41 or -1.7%

This week rode everything hard and put it away wet.

October GOLD futures gapped down on open. Comex spot month slammed down $20.10 to $1,188.00.

The GOLD PRICE continues in a down trend begun with a double top on 18 and 25 June. It has nearly reached the bottom uptrend line from the February and March lows. Gold hits that line at about $1,175. Today's fall ought to mark the limit of the entire correction, or nearly so, provided the gold price closes no lower than $1,175. Below that strong support flexes muscles at $1,160 and $1,145.

Today the SILVER PRICE wiped out all last week's work, returning to where it stood seven days ago. The trip has merely wasted buying power. After opening at $18.23, the silver price fell straight down to a $17.72 low just before 10:00 EDIT. Disinclined to drop further, it vibrated between $17.75 - $17.90. Comex closed $17.773, down 57.3c.

What next? The silver price has fallen through its uptrend line from February 2010, but only barely. Even if it fails to hold here, the uptrend line from November 2008 should catch it, and today that lies about $16.70. Between here and there stands silver's 200 DMA at $17.63, which might stop any fall as well.

From here the rest of the summer will be a frustration, a trading range. The silver price may erode maddeningly, or it might hang around here. Next week will tell us. If the silver price breaks $17.50, then it will move lower, to $16.50; if the silver price clears $18.50, it will race higher.

THE GOLD SILVER RATIO is still within its even-sided triangle, and presents us with a cliffhanger. Over 69.5 it breaks out upside, under 64.5 to the downside.

Keep on buying silver and gold on every price decline. Both remain in a primary uptrend, a bull market that will run another 5 - 10 years.

STOCKS opened down this morning, fell hard, and kept on falling all day. Low was struck at 10079.58, but closing came barely above that at 10,097.90, down a massive 261.48. S&P hurt worse, shedding 31.6 to close 1,064.88.

The Dow had rallied to its 200 day moving average (10,380.03) and today collapsed. Once it falls below its 6 July 2010 low at 9,743, it finds only air to 8,800. Below that the next support appears around 6,500. The Dow is set to drop dramatically.

The DOW IN GOLD DOLLARS has topped in its countertrend rally that carried it to G$177.58 (8.5907 oz). Last low came at G$162.48 (7.860 oz) on 30 June, so when it passes that it will accelerate into free fall, hurtling toward G$145.37 (7.032 oz). Ultimate target is G$41.34 to G$20.67 (1.000 to 2.000 oz). Gold should strengthen against stocks, that is, stocks should plunge.

US DOLLAR INDEX underwent a wretched week, losing 141 basis points, nearly 2%. The dollar has fallen so long that a rally, even a weak countertrend rally, is bound to come soon. Dollar appears to have made a little V-bottom today at 82.085, so it has fulfilled my 85.00 - 85.25 target for this move. Expect a rally next week. Euro at 1.2926 has nearly rallied to the area (1.2987) where it began its fall off the cliff, so it is ready to correct downward.

Y'all enjoy your weekend! Argentums et aurum comparanda sunt --
-- Silver and gold 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 bubble has burst, primary trend down.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



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
The-MoneyChanger.com

© 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.



The Silver Price Needs Not to Fall Below $17.90 nor the Gold Price Below $1,198 for Continuation of the Uptrend

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

Silver Price Close Today : 18.274
Change : 0.037 cents or 0.2%

Platinum Price Close Today : 1523.80
Change : 10.80 or 0.7%

Palladium Price Close Today : 465.75
Change : 12.45 or 2.7%

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

Dow Industrial : 10,366.72
Change : 3.70 or 0.0%

US Dollar Index : 83.37
Change : -0.28 or -0.3%

The GOLD PRICE marched along splendidly until the US market opened. It dropped from $1,211 on open to $1,206, traded sideways until 11:00 when it literally shot from $1,208 to $1,218, trading sideways for one hour. Then it fell straight down in a few minutes, finally stopping at $1,202.80. Comex closed $1,206.8, down 6.50.

This paints a picture resembling an "island reversal" on the daily chart. Technically it is not quite an island reversal because those have gaps up to the island and gaps jumping off. Generally islands imply lower prices. Clearly, somebody big was standing at $1,218, waiting to hit gold in the head with a cricket bat.

More bewilderment: the gold price closed down but silver closed 3.7c higher at $18.204, refusing to confirm gold's trembling.

The SILVER PRICE chart also shows an island-like formation at $18.45, but when silver fell off the island, prices refused to fall lower than they had been before it jumped into the island.
So $18.50 resistance stopped the silver price in its first try to break down the $18.50 door.
The island implies lower prices tomorrow. 'Tis desirable for continuation of the uptrend that the silver price not fall below $17.90 nor the gold price below $1,198.

This morning the Dow opened 30 points in the hole, climbed to 10,400 near noon, then fell without any break until 3:30, by which time it had lost 60 points from yesterday. But wait! Mysterious friends began buying in the last 30 minutes to carry the Dow up to unchanged plus a gigantic 3.7 at 10,366.72. Confused, the SP500 contradicted the Dow's weaseling higher close with its own lower close, down 0.17 to 1,095.17. The Nasdaq and Nasdad 100 rose minutely while the Russell 2000 fell along with the Amex Composite, the NYSE composite, and the Wilshire 5000.

Get the picture? 'Tis a confused, bewildered market, and confused markets often do what? Drop.
The US DOLLAR INDEX tried to hold on the first half of the day but collapsed about midday, wilting to 83.205. It then drifted up a tad to where it is now trading at 83.366, down 27.7 basis points. The dollar continues to erode with no sign of let up. It has been dropping so long it makes me expect a surprise rally, but it appears to have made up its mind to reach 82.25.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Tuesday, July 13, 2010

Tomorrow the Gold Price Ought to Advance.

Gold Price Close Today : 1213.30
Change : 14.80 or 1.2%

Silver Price Close Today : 18.237
Change : 34.0 cents or 1.9%

Platinum Price Close Today : 15.24
Change : -1,497.76 or -99.0%

Palladium Price Close Today : 465.95
Change : 12.65 or 2.8%

Gold Silver Ratio Today : 66.53
Change : -0.437 or -0.7%

Dow Industrial : 10,363.02
Change : 146.75 or 1.4%

US Dollar Index : 83.52
Change : -0.68 or -0.8%

The SILVER PRICE has made a double bottom at $17.60 over the past 11 days. Overnight the silver price rose steadily from $17.85 to $18.15 beginning about 6 hours before New York open. On open it shot up to $18.30, and the rest of the day traded flat between $18.20 and $18.30. Comex closed $18.237, up 34c (+1.9%). Unless this is yet another trading range fake out, the silver price tomorrow ought to overleap $18.30, but that's not the big roadblock: $18.50 is. Clustered around $18.50 are also the 20 day moving average ($18.43) and the 50 DMA ($18.38). A close below $18.15 gainsays all this.

The GOLD PRICE climbed over that $1,200 fence in European trading and jumped straight up (I am tempted to say "gapped") to $1,205 - $1,206. On the New York opening it bounced straight up again over $1,2210, made a quick sideways flag, then jumped again to $1,217.65 at 9:00 a.m. Rest of the day gold traded sideways, drifting slightly lower to a Comex close at $1,213.30, up 14.80 (1.2%).

The last 11 trading days have left a pattern that looks like an inverted head and shoulders, a bottoming and reversal formation. If that is correct, the neckline is at $1,212 - 1,213. Tomorrow gold ought to advance. Considering the large drop that started this correction, not much resistance lies between here and $1,225. The gold price needs to close above $1,225, then confirm and add credibility by closes above $1,230 and $1,240. the 20 DMA, tripwire for higher prices, stands at $1,226.56; 50 DAM at $1,217.16.

If the gold price falls through $1,210 it will sink for another round below $1,200.

My, my, stocks ran hog-wild today. Dow rose 146.75 (1.44%) to 10,363.02 and S&P500 climbed 1.54% (up 16.59) to 1,095.34. Almost all that gain came early in the day on open, while the balance of the day was spent bouncing between 10,350 and 10,400. Maybe big selling overhead slowed it down?

Now stocks may rise for a while yet, so at this point I have to remind y'all that one-day parties do not a long term trend make, and the long term trend fro stocks is down.

Since August 1999 and June 2003 stocks have lost eighty per cent against gold and silver. They will lose another 80% from here. Adjusted for inflation, stocks have lost you money since 2000. Socks are light years from undervaluation, and 4 - 5 years from a bottom. I can think of no reason whatever to buy stocks, other than a wish to commit financial suicide.

So you see, a one-day or a ten-day rise in stocks make no difference to me, I don't want to ride on the Titanic.

The US DOLLAR INDEX ran head first into a titanium wall at 84.50, then slid down the wall to end today at 83.519, down 68.4 basis points (-0.88%) for a new low for the move as well as a new closing low. After all the losses it has suffered lately, you'd think the dollar would stage a modest rally, but none appears. Yesterday's fair beginning became today's pitiful debacle. I would never trade currencies, for the pellucidly simple reason that you cannot possibly read the chart correctly. Why? because governments manipulate their currencies, and throw surprise parties at your expense. So you can look at a currency chart for a general idea of trend, but that trend is always subject to pre-emption, if only for a short time. Euro today hit a new high for the move at $1.2736. And you may assume that the Chairman of the US Fed and Kommissar of the European Central Bank are working jointly to manipulate exchange rates.

All of that is a preposterously prolix way to say, You can never tell when the dollar will turn abruptly and without reason, you can only be certain that the primary trend is firmly DOWN.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Monday, July 12, 2010

Yes, Keep on Buying Gold and Silver on Every Price Retreat

Gold Price Close Today : 1198.50
Change : (11.10) or -0.9%

Silver Price Close Today : 17.897
Change : (0.156) cents or -0.9%

Platinum Price Close Today : 1513.00
Change : -17.80 or -1.2%

Palladium Price Close Today : 453.30
Change : -4.95 or -1.1%

Gold Silver Ratio Today : 66.97
Change : -0.036 or -0.1%

Dow Industrial : 10,216.27
Change : 18.24 or 0.2%

US Dollar Index : 84.21
Change : 0.22 or 0.3%

GOLD contradicted all its Friday progress by closing below $1,200. With a low at $1,196.15 it barely stayed above Friday's low.

About 10:45 gold's enemies struck at $1,202, selling fiercely enough to drive gold under $1,200 to $1,196. Rest of the day was spent ooching sideways between $1,200 and $1,198. Comex closed down $11.10 at $1,198.50.

Lo, silver also gave back all Friday's gains. Low came at 1776c in a V-bottom, then silver climbed to 1795c, where it remains. On Comex it closed down 15.6c at 1789.7c.

Behold, a traders' market! Up and down in expensive but essentially meaningless gyration, winding tighter and tighter in an even-sided triangle for an eventual breakout. That comes only after a suitable period of penance, another 2-3 weeks. Range is defined by 1750c and $1,185 and $1,225 and 1850c. Inbetween lies only the feeding ground of day-traders, scalping the short-sighted and fainthearted.

Yes, keep on buying gold and silver on every price retreat.

Ahh, Americans are so convinced that everything American is superior to everything foreign. Well, maybe they are right, but not the way they think. Al Thomas of www.mutualfundmagic reports that California bonds now carry a higher interest rate that Greece or Portugal. He also says only two (2) American states are in the black, so get out of municipal bonds while you still can.

Contrary to what I was thinking Friday, the US Dollar Index today appears to be impulsing upward. Unless it closed above 85.25, consider it only a short-lived countertrend rally. The faster-moving 2p0 day moving average (85.30 now) has headed down and has also crossed below the 50 DAM (85.68). That shows the dollar's momentum is downhill, but momentum changes. We will watch this rally to see how it moves this week. Dollar Index is trading now at 84.208, up 21.5 basis points and above the magic 84. Well, psychologically magic.

STOCKS may yet move higher, but day by day the chart grows further and further sideways, like a limb on a live oak. Unhappily. unlike a live oak tree, this limb conquereth not gravity.

Today stocks whipsawed badk and forth over the unchanged line all the livelong day, burning up buying power like the National Guard buring up ammon on maneuvers. Dow closed at 10,216.27, rising a magnificent eighteen point two one points. S&P500 closed at 1,078.75, up a microscopic 0.75. Beware, beware! Big drop will strike soon.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Friday, July 09, 2010

Both Gold and Silver Prices Made Bottoms on Wednesday and Confirmed Those Bottoms Yesterday

Gold Price CloseToday : 1,209.60
Gold Price Close2nd July : 1,207.40
Change: 2.20 or 0.2%

Silver Price Close Today : 1805.3
Silver Price Close 2nd July : 1769.8
Change 35.50 or 2.0%

Platinum Price Close Today: 1,530.80
Platinum Price Close 2nd July : 1,503.30
Change: 27.50 or 1.8%

Palladium Price Close Today: 458.25
Palladium Price Close 2nd July : 432.40
Change: 25.85 or 6.0%

Gold Silver Ratio Today: 67.00
Gold Silver Ratio Close 2nd July : 68.22
Change: -1.22 or -1.8%

Today is the 19th anniversary of our acquittal in federal court on tax charges, so we are celebrating and I must leave early. You can read about it at http://www.the-moneychanger.com/dangerous.phtml. To God alone be the glory. If the government had had their way, nineteen years would have been my sentence -- but they didn't have their way. So dangerous am I!

Silver and gold prices struggled across the week defending their lows with alacrity and victory, and closed the week above critical support levels, just to prove their point. The Dollar has stepped into a mine shaft, and stocks are staging a zombie rally.

I am writing this before stock markets close, but expect no big difference at closing. Dow stands up 39.28 at 10,178.27 (S&P up 6.34 at 1,076.59), but it has been a cliff-hanger day. Stocks tried to rise early in the day and were whipped back to negative territory, then tried weakly several times to rally. Here around 2:30 EDT they have managed to rally to the day's high, aided, no doubt, by Nice friends in Government places. Makes no difference, as they are pounding paper money down a rat-hole. Stocks will drop much further, most likely beginning early next week.

The US DOLLAR INDEX rose today, but has been scourged the whole week. Note that today it could not climb and hold above 84, and is now trading at 83.986, up 16.2 basis points, but below psychologically critical 84.

Dollar might be positioned to rally next week, if only a short rally. Appears headed now for 82 before strong support catches it. Euro trading today at $1.2644.

Both GOLD and SILVER PRICES made bottoms on Wednesday and confirmed those bottoms yesterday. We may suffer much more range trading, but won't see those lows again, I don't believe.

All attempts to break silver and gold last week failed. Yes, that is important. The silly Bank for International Settlements announcement last week that it had swapped foreign currencies for gold from European commercial banks constitutes only another sally in the propaganda war against gold that central banks an the IMF have been waging against gold since memory runneth not to the contrary, or since 1992 at least. They make these announcements to frighten the gold market, but upon closer inspection they don't pass even the coarsest hogwash filter.

Ponder: The BIS took 349 tonnes (11.2 million ounces) of gold in exchange for currencies, but as a swap. That means that in a year or a quarter the BIS will sell the gold back to them, probably at an agreed price, and buy back the currencies. Now, exactly HOW does this closed transaction affect the open market? Does it add gold supply? Nope. O, O, O, squeak the newspapers, but what if the banks can't buy back the gold and throw it on the open market? Well, they won't, but what if they did? The London gold market trades an average of 18.3 moz per day. All the BIS swap amounts to a gigantical, colossal, gargantuan 61.2% of a single day's trading in London.

See what I mean? Can't pass the hogwash filter.

Silver today gained 20.1c to close at 1805.3c. Gold added $13.80 to close at $1,209.60 on Comex. These numbers please the psyche, above 1800c and $1,200, but technically they speak with forked tongue. To prove it has left this correction behind, silver needs to climb above 1850c then 1900c and gold must better $1,225.

Lots of folks are droning how silver and gold never rally in the summer. True, they usually don't, but where is it engraved in stone that they can't this year?

Probably more range trading awaits us, but y'all ought to use every price retreat to buy more silver and gold.

Here's a mighty irony: Holland will face Spain in the World Cup championship? Because from 1568 - 1609 the Dutch fought a War for Independence against the Spanish empire, a long & bloody war for independence. Now they meet on a bloodless field over a leather ball.

Y'all enjoy your weekend.


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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Thursday, July 08, 2010

Keep on Buying Toward the Low Side of The Trading Range, 17.85 and $1,185

Gold Price Close Today : 1198.60
Change: 3.80 or 0.3%

Silver Price Close Today : 17.979
Change 14.6 cents or 0.8%

Platinum Price Close Today: 1518.00
Change: -5.40 or -0.4%

Palladium Price Close Today: 446.35
Change: -2.30 or -0.5%

Gold Silver Ratio Today: 66.67
Change: -0.333 or -0.5%

Dow Industrial: 10,018.28
Change: 274.66 or 2.8%

US Dollar Index: 83.97
Change: -0.11 or -0.1%


Gold and silver are oversold, but nothing says that oversold can't get more oversold. Metals whipsawed me this morning, dropping early in the day. Whipsaws are typical of trading ranges.

Most pertinent observation here is that silver has touched its 200 day moving average, a frequent destination -- and stop -- to silver corrections. Today for the umpteenth time silver fended off an attack on the lows at 1771, but was in turn beaten back at 1815c.

Gold defended $1186.90, but fainted at $1,207.66. Comex closes came in at 1785.2c, down 12.7c, and $1,195.80, down $2.80. Keep on buying toward the low side of thee trading range, 1785c and $1,185.

The DOW today reached its 20 Day Moving Average (10,135.36) 7 likely will climb a bit higher, maybe 10,200, before it turns & runs from success. Do not be seduced, this is merely a bear market rally. The bear aims to raise the hopes of the doomed, the better to maul them later.

The Death Cross -- stocks' 50 DMA crossing below the 200 DMA-- happened yesterday. That means that momentum is pointed straight down. Still the Dow -- conveniently, wink, wink -- closed up 120.71 at 10,138.99 while the S&P500 gained 9.98 to close at 1,070.25.

You'd think the US dollar index would at least stage a little rally to save face, but not yet. The dollar has now knocked 3 times on the trap door at 83.70. Usually three knocks suffices to open the door so it can fall through. The dollar has pointed its face toward 82 and most likely will reach it. Today the euro is trading at 1.2691, up 0.4 basis point.


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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Wednesday, July 07, 2010

Time to Buy Gold

Gold Price Close Today : 1198.60
Change : 3.80 or 0.3%

Silver Price Close Today : 17.979
Change : 0.146 cents or 0.8%

Platinum Price Close Today : 1523.40
Change : 16.80 or 1.1%

Palladium Price Close Today : 448.65
Change : 14.65 or 3.4%

Gold Silver Ratio Today : 66.67
Change : -0.333 or -0.5%

Dow Industrial : 10,018.28
Change : 274.66 or 2.8%

US Dollar Index : 83.97
Change : -0.11 or -0.1%

Tomorrow the US DOLLAR INDEX will try feebly to rally. Today it lost 11.4 basis points and is now trdeing at 83.969. Low today was 83.75, lower than yesterday. Dollar is sledding down a steep hill.

Surpirse, surprise, the Dow rallied 274.66 points to close at 10,018.28. S&P500 gained 32.21 to 1,060.27. Tell the folks in Port-au-Prince that we've got another Zombie rally here: the dead are walking. Recall that bear market rallies are sudden, sharp, and . . . short-lived. The bear tries to entice as many victims into his lair as possible. Don't become one of them.

Lo, I am disgusted. Meant to buy silver and gold today around 1780c and $1,190, got distracted and boom! 1803c and $1,203. Five day charts for silver and gold prices mirror each other, with a V-bottom today. Both metals will probably remain range-bound for a while, but that may have been the bottom today. Time to buy silver and gold.

Today I have a favour to ask of y'all. My friend, Stan Poston, has glioblastoma, a fast-growing brain cancer. Last fall he had successful surgery, then opted for alternative treatment rather than chemo and radiation. He has enjoyed great health since then, but in the last few weeks has begun to show symptoms of recurrence. Would you please pray for Stan's recovery? You can read more and see a picture of Stan at http://www.caringbridge.org/visit/stanposton. His wife Janet is also pictured there. The three grandsons in the picture we share, as Stan's daughter Jena is married to my son Wright. Many thanks for your prayers.


- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Friday, July 02, 2010

Lower Silver and Gold Prices Offer you Another Opportunity to Buy Metals on Sales - Don't Pass it Up.

Gold Price CloseToday : 1,207.40
Gold Price Close : 25-Jun 1,255.80
Change:-48.40 or -3.9%

Silver Price Close Today : 1769.8
Silver Price Close : 25-Jun 1911
Change -141.20 or -7.4%

Platinum Price Close Today: 1,503.30
Platinum Price Close: 25-Jun 1,568.10
Change: -64.80 or -4.1%

Palladium Price Close Today: 432.40
Palladium Price Close 25-Jun 477.40
Change: -45.00 or -9.4%

Gold Silver Ratio Today: 0.01466
Gold Silver Ratio 25-Jun: 0.01522
Change: -0.00056 or -3.7%

Dow Industrial: 9,686.48
Dow Industrial 25-Jun: 10,143.81
Change:-457.33 or -4.5%

US Dollar Index: 84.373
US Dollar Index 25-June: 85.299

Whoooo, it was a rough week, especially for stocks and the dollar. Wasn't too killing easy for silver and gold, either.

SILVER and GOLD PRICES worked through a rough week, struggling toward old tops only to break yesterday. The gold price lost $39.20 and dropped to $1,206.30. Silver had one of those Big Buck Down Days, losing 91.1c to close $17.76. Enough pain for everybody.

Must I yet again be tortured with the doofy articles written by pretentious know-nothings screaming that the "Gold bubble is dead"? I reckon so. What are we dealing with? A correction in the gold market. I think we probably saw the bottom of it yesterday, but I will play the pessimist. As long as gold remains above $1,183, the decline is over and gold is healing for the next race upwards. Ditto silver, at 1750c.

Today both metals coasted. Silver closed Comex down 6.2c at $17.6980 while gold rose $1.10 to $1,207.40. Before the weekend nobody wants to carry positions, so in the aftermarket gold climbed to $1,212 and silver to $17.90. There's a good likelihood metals will move sideways, licking their wounds, for most of July. Don't expect much lower prices.

In fact, these lower prices offer you another opportunity to buy metals on sales. Don't pass it up.

Yesterday and today alone the US dollar index lost 175.4 basis points. In the last two days the dollar index fell from 86.20 clean through 85 and deep into the 84s. Today it lost another 34.3 basis points to close at 84.373. You are watching the long awaited movie, "Revenge of the Euro-Nerd," as the Euro stages it first serious rally after a roughly 1700 basis point plunge since April. Off a 119.13 June low the Euro has now rallied to 125.68 and through its 50 day moving average (124.85). This Euro rally may drag on a while as the world decides which it prefers, Euro-trash or US-trash. Neither has any intrinsic value, and one is about as bad as the other. Tough choice, that: Would you like leprosy or small pox?"

Now that the dollar has fecklessly fallen through 85, it has jumped through into a mine shaft with no landing above 82.25. I'm not 100% persuaded yet, but the dollar is beginning to leave the impression that all hope for resuming its rally has vanished. Expect a lower dollar next week and a higher Euro.

The Nice Government Men had some heavy lifting today with stocks merely to prevent them lurching through 9,600. Today's Dow chart looks like a great bowl with the open at 9,732, high at once at 9,770, then a long rounding swoon to a 9,614 low about 1:00. About that time the alarms began to clang in the Nice Government Men's Market Fire House. Down they came, sliding down their brass poles, to hop into their Manipulation Machines to pump liquidity on a dying market. That gradually brought the market about as it climbed slowly up to close down only 41.49 at 9,732.53. The S&P500 followed suit, falling 3.34 to 1,027.37. Has anybody besides me noticed how close to the magical 1,000 the S&P500 hath fallen? Lo, the tears will pour and the rats will flee when it breaks 1,000.

Y'all enjoy your weekend.


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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.



Thursday, July 01, 2010

After this Particular Dog-Fight, Both Metals Will Turn Up Again

Gold Price Close Today : 1206.30
Change: -39.20 or -3.1%

Silver Price Close Today : 17.760
Change -91.1 cents or -4.9%

Platinum Price Close Today: 1501.50
Change: -35.80 or -2.3%

Palladium Price Close Today: 430.10
Change: -15.65 or -3.5%

Gold Silver Ratio Today: 67.92
Change: 1.215 or 1.8%

Dow Industrial: 9,732.53
Change: -41.49 or -0.4%

US Dollar Index: 84.61
Change: -1.41 or -1.6%

The SILVER PRICE today rolled back all its gains since 4 June; the GOLD PRICE since 25 May. Silly -- the root of the word means "empty" -- news reports talk about "deflation scares" and the sort of blather that usually foams from their mouths.

I think it's probably much simpler. The US dollar today hit that 85 support one time too many and fell 146 [sic] basis points to 84.606, down 1.82%. Yet meanwhile stocks fell -- well, as much as the Nice Government Men would let them fall -- and SILVER and GOLD PRICES fell, too. What gives? Look elsewhere: at the Euro. It rose 2.5% today, which sufficiently explains both the dollar and metals.

The Euro scare had been shooing investors by flocks into metals. Today the Spanish, one of the EU's financial invalids (not to say "terminals") managed to float a bond issue that somebody actually bought. Arriba! The game is alive again! Oh, help. Is everybody in the world that goofy? I'll come back to this, but first to silver and gold.

The silver price broke that $18.50 - $18.40 resistance and hit an elevator shaft. It dropped 91.1c to $17.76 by the time Comex closed. Low was $17.69. Now, here's the surprise: silver did not fall through its uptrend line from the 5 Feb to 4 June lows. The 200 DMA now stands at $17.58, so silver did what it so often does, revisited its 200 DMA. The gold silver ratio also jumped up to 67.92, but this is not escape from the reservation either. Silver remains in an even-sided triangle, and this is not yet a downside breakout.

The gold price gapped down $5 on the opening and never recovered. It sliced through $1,230 and $1,225 without slowing down, caught an hour or so at $1205, then faded again. Comex closed down $39.20at $1,206.30, but the low was $1,194.70. Aftermarket is oscillating around $1,200. Notice that none of this breaks that $1,190 support. The gold price rolled back to its trend line rising from the November 2008 low, and fell below its 50 DMA ($1,211.50). Not comforting, but no seismic evidence of the End of the World, either. It could foretell a visit to the 200 DMA at $1,128.75.

Certainly silver and gold prices both suffered technical damage and wounded investor confidence. Friends, this is what markets do. They swing back and forth, like pendulum do.

Today I had a conversation with a friend who is a successful investor. We weren't swapping tips, but sharing how much Richard Russell had taught both of us. See ww2.dowtheoryletters.com. Mostly we were marvelling at the simplicity and indispensability, of a very few fundamental investing principles. And, of course, the most fundamental of all, the foundation that keeps the house from falling down, is always align your investments with the primary trend. Identify the trend that is carrying a market up or down for the next 15 - 20 years, and ride that trend. When that market drops, even brutally as silver and gold did today, you don't pull out your .45 and stare at it thoughtfully, you shrug it off and enjoy supper. You know you've done your homework: you've identified the primary trend. You bought the market, if it's rising like silver and gold, or sold it, if it's falling like stocks, and then you lean back and wait for it to happen. It takes patience, and that's where we all fall short of a full bucket.

Now, whether silver and gold prices take a big tumble from here or they rise to the moon, maybe y'all can patiently wait to see, because you know that after this particular dog-fight, both metals will turn up again. And y'all can slap me if you like (if you can reach through your computer screens), but silver still looks like a market waiting to make a huge move up. Sign me, "Unrepentant and Unreconstructed."

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.