Friday, June 24, 2011

The Gold Price Will Drop More, Aiming at $1,486.50, then $1,460 - $1,450, then the 200 DMA at $1,410

Gold Price Close Today : 1,500.50
Gold Price Close 10-Jun : 1,538.60
Change : -38.10 or -2.5%

Silver Price Close Today : 3463.8
Silver Price Close 10-Jun : 3573.9
Change : -110.10 or -3.1%

Gold Silver Ratio Today : 43.319
Gold Silver Ratio 10-Jun : 43.051
Change : 0.27 or 0.6%

Silver Gold Ratio : 0.02308
Silver Gold Ratio 10-Jun : 0.02323
Change : -0.00014 or -0.6%

Dow in Gold Dollars : $ 164.42
Dow in Gold Dollars 10-Jun : $ 161.28
Change : $ 3.13 or 1.9%

Dow in Gold Ounces : 7.954
Dow in Gold Ounces 10-Jun : 7.802
Change : 0.15 or 1.9%

Dow in Silver Ounces : 344.55
Dow in Silver Ounces 10-Jun : 335.89
Change : 8.66 or 2.6%

Dow Industrial : 11,934.58
Dow Industrial 10-Jun : 12,004.36
Change : -69.78 or -0.6%

S&P 500 : 1,268.45
S&P 500 10-Jun : 1,271.50
Change : -3.05 or -0.2%

US Dollar Index : 75.587
US Dollar Index 10-Jun : 75.034
Change : 0.553 or 0.7%

Platinum Price Close Today : 1,686.00
Platinum Price Close 10-Jun : 1,757.00
Change : -71.00 or -4.0%

Palladium Price Close Today : 734.00
Palladium Price Close 10-Jun : 744.50
Change : -10.50 or -1.4%

Even the scoreboard doesn't quite tell the whole tale this week. In three days the GOLD PRICE lost $52.40 and the SILVER PRICE lost 209.6c. Stocks tried to penetrate resistance, but failed, no matter how much the NGM helped them. Platinum and palladium took a thrashing while the dollar verified its uptrend.

When a market gives back $52.40 (3.4%) in three days, clearly it is correction mode with a good deal of gravity-ward inertia. Once the GOLD PRICE crossed below $1,540 yesterday, the trap door opened. After catching yesterday at $1,515 support, gold could no more than rally to $1,524.10, near $1,525 resistance, and faint today. Plunged as low as $1,498.22, but managed to close a chiseling 50c over $1,500 at $1,500.50, down $%19.60.

It's possible, I suppose, that the GOLD PRICE will rally Monday but not very likely. In the past two days it has cut clean through its 20 Dma ($1,534.36) and 50 DMA ($1,518.88), and its uptrend line from the January low.

The GOLD PRICE will drop more, aiming at $1,486.50, then $1,460 - $1,450, then the 200 DMA at $1,410. This should happen right quickly. Watch closely. Be ready to buy.

The SILVER PRICE has lost 209.6c in the past two days, falling 36.4c today to 3,463.8c and meeting the last (13 June) low. Some support remains at the bottom of the range and May low, 3353c. Once it passes that mark, the silver price will touch its 200 DMA (now 31.36) or even the 300 DMA (now 2704c).

Listen, letthe experts all cry and whine and puke in their wastebaskets all they want, y'all just keep your head on your shoulders. Should we not take the correction with the rally? And all the more because it offers us a superb opportunity to pick up silver at firesale prices? Watch closely! Sometime in the next five weeks the bottom should strike. Ready yourself!

Gold/Silver ratio is rising (today at 43.319) but not yet to the high so far, 44.41. 200 DMA stands at 46.46, 300 DMA at 53.18. We are waiting to swap gold back into silver.

Real markets don't need government money. But clearly, stocks need the friendship of the Nice Government Men on the Plunge Protection Team. Week was filled with silly stuff that just don't look right.

Today the Dow sank beneath 12,000 once again, leading one to believe this will be a permanent situation. Dow closed down 91.16 at 11,958.84, off 3/4%. S&P lost 0.98%, 12.61 points lower at 1,270.89.

New support has become last week's low at 11,862.53, and MACD which had turned up has now rolled over. The 200 Day Moving Average at 11,777 stands not far distant and, to a market falling on rising volume, looks like a reasonable near-term target.

Stocks -- they're the Collard Juice on the Investment Health Food Buffet.

After all the sweating, the US dollar index only backed off its mid-June 76.41 high to the 20 DMA at 75.20, then today and yesterday rose 68 basis points. Today the dollar index garnered 14 of those points to end at 75.587. Minimum target here, too, is the 200 DMA now at 77.30, but more likely is something above 78.

Euro is curled up today at 1.4127 licking its wounds and looking sick. Closed at 1.4188, down 1/2% and sitting right above the last (1.4100) low. Looks disconsolate enough to jump over the edge at any time. Nice Government Men of Japan are doing their job holding the yen below 125c/Y100 (Y80/$). Yet stands today at 124.36c/Y100 (Y80.41/$).

On 24 June 1314 Robert the Bruce's Scots beat Edward II of England at the Battle of Bannockburn and secured Scotland's independence. Nothing you want in your enemy more than overconfidence.

On 24 June 1968 the United States government reneged on and repudiated its promise to redeem silver certificates for physical silver. Yep -- trustworthy.

Y'all enjoy your weekend.

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.