Monday, April 04, 2011

The Silver Price Slammed Through the $38 Barrier

Gold Price Close Today : 1432.20
Change : 4.10 or 0.3%

Silver Price Close Today : 38.484
Change : 74.7 cents or 2.0%

Gold Silver Ratio Today : 37.22
Change : -0.628 or -1.7%

Silver Gold Ratio Today : 0.02687
Change : 0.000446 or 1.7%

Platinum Price Close Today : 1785.00
Change : 16.50 or 0.9%

Palladium Price Close Today : 783.80
Change : 9.30 or 1.2%

S&P 500 : 1,332.87
Change : 0.46 or 0.0%

Dow In GOLD$ : $178.98
Change : $ (0.16) or -0.1%

Dow in GOLD oz : 8.658
Change : -0.008 or -0.1%

Dow in SILVER oz : 322.21
Change : 0.54 or 0.2%

Dow Industrial : 12,400.03
Change : 23.31 or 0.2%

US Dollar Index : 75.90
Change : 0.043 or 0.1%

Recognizing the difference between a "bubble" and a "primary trend" (bull market) is like a bakery quality control supervisor distinguishing between a "cookie with a hole in it" and a "doughnut." Lots of those who pose as market quality control supervisors, the gurus and experts, are having trouble making that distinction.

Does that make a hill of beans to you? It ought to, since the first and most important principle of all investing is always align your investments with the primary trend.

The GOLD PRICE perched precariously just below its last high, closing Comex $4.10 richer at $1,432.20, but without a new high close and a breach of that stubborn resistance at $1,438 under its belt. This performance is not bad, but it accomplisheth not the needful goal: breaking that resistance and running to new all time highs, particularly above $1,451.

The momentum indicators I watch all sing a sweet tune of higher prices, and sound no warning sirens.

The precarious part reflects gold's danger here. Should it fall through $1,410, then $1,400, it will have posted a double top, or potentially a broadening top. On the other hand, it might be forming a right shoulder on an inverted head and shoulders that promises to add $100 points to a breakout at $1,438.

Gold will go higher this week, or, ICBW.

The SILVER PRICE slammed through the 3800c barrier and is now gobbling up dollars 50c and 75c at a bite. Comex last saw silver at 3848.4c, up 74.7c (close enough to 75c to scare it to death). Yes, 'tis nuts. Yes, 'tis overbought. Yes, 'twill bring a hangover SOMEday. Yes, 'tis climbing higher still, bet thereupon.

US DOLLAR INDEX didn't reveal anything today, just wasted oxygen. Traded flat between 75.70 and 75.98, but didn't violate last Thursday's 75.55 low.

The mind says that if QE2 money printing influenced markets before it began, that its impending cessation ought likewise to influence them. Ought to send the dollar scooting up, and bond yields scooting down. Alas, 'tain't so. Bonds are dropping and the dollar has gone from catastrophe to catalepsy.

What a currency! Sure proves the wisdom and necessity of central banks, doesn't it?

A friend mentioned today that Bumblin Ben Bernanke the Banksters' Bunko Man had after 3 years been forced to reveal what banks got the bailout money. You mushrooms are getting mighty uppity, wanting to know what Bumblin Ben is doing with the dough he took from your treasury. You are a suspicious lot, when he was just trying to save humanity -- oh, AND the bankers' trillions.

The euro, scrofulous European phony money that poses as an item of value, could make no headway today. This failure strikes at precisely the last high, and resembleth a double top. Euro must drag its scrofulous, scabrous body through that high, 1.4234, to disprove that double top thesis. Why anybody would buy that trash lies beyond my ken. I'd rather spend my money on a hog scalder or a jet engine or anything that might actually be worth something on its own feet. Gold in euros is building a long even-sided triangle and when it breaks out will shoot a long ways, up or down. Right now its skating along its 200 DMA, so that breakout ought to point toward the moon, and not earth's nether regions.

STOCKS, stocks, stocks! What can I say about the investment I love to hate on the day it makes a new high for the move? I'll think of something -- acid.

Friday and Monday stocks bumped along and around that 12,400 ceiling. Maybe it will stymie them, or maybe it will break through. Either way, this does not look like the chart of a market I want to own. Why is it levitating? I don't know, but suspect a monetary magician behind the performance, along with lots of legerdemain and illusion.

To the chase! Why would one want to own stocks anyway? Because they represent a stream of future revenue. Aha! But what if the future goes dry, and the revenue floweth not? What is, as many have done, they stop paying dividends and keep the future for themselves? Finally, what if Providence locks them into a primary down trend (bear market)? Why, in that case, I wouldn't any more want to own them than I want to own your case of athlete's foot.

But reason? Reason? Nay, all reason to own stocks hath fallen in the streets, and been run over by a garbage truck.

The Dow today closed at 12,400.03, up 23.31. S&P500 found enough new buyers to add a magnificent 0.46 [sic] point. Can y'all spell d-o-u-b-l-e-t-o-p? Or d-a-w-g?

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

- Franklin Sanders, The Moneychanger

© 2011, 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.