Friday, March 30, 2012

Unless the Gold Price drops Below $1,645 we will not see Lower Prices the Bottom is in and It's Time To Buy

Gold Price Close Today : 1,669.30
Gold Price Close 23-Mar : 1,662.30
Change : 7.00 or 0.4%

Silver Price Close Today : 3246.9
Silver Price Close 23-Mar : 3224.8
Change : 22.10 or 0.7%

Gold Silver Ratio Today : 51.412
Gold Silver Ratio 23-Mar : 51.547
Change : -0.14 or -0.3%

Silver Gold Ratio : 0.01945
Silver Gold Ratio 23-Mar : 0.01940
Change : 0.00005 or 0.3%

Dow in Gold Dollars : $ 163.61
Dow in Gold Dollars 23-Mar : $ 162.67
Change : $ 0.94 or 0.6%

Dow in Gold Ounces : 7.915
Dow in Gold Ounces 23-Mar : 7.869
Change : 0.05 or 0.6%

Dow in Silver Ounces : 406.91
Dow in Silver Ounces 23-Mar : 405.63
Change : 1.28 or 0.3%

Dow Industrial : 13,212.04
Dow Industrial 23-Mar : 13,080.73
Change : 131.31 or 1.0%

S&P 500 : 1,408.47
S&P 500 23-Mar : 1,397.11
Change : 11.36 or 0.8%

US Dollar Index : 78.949
US Dollar Index 23-Mar : 79.366
Change : -0.417 or -0.5%

Platinum Price Close Today : 1,639.40
Platinum Price Close 23-Mar : 1,626.20
Change : 13.20 or 0.8%

Palladium Price Close Today : 653.90
Palladium Price Close 23-Mar : 659.20
Change : -5.30 or -0.8%

On the
SILVER and GOLD PRICE last week I wrote, "The end to this correction for silver and gold is not far away, two weeks at most, I suspect. Yes, we might have seen it already, but we'll know that if we get a confirmation like this: a rise to 3300c, then a fall back to 3150c but no lower." The GOLD PRICE had to hold $1,627.

Ponder then, and consider: The SILVER PRICE rose this week to 3318c, then fell back to 3163.2c (yesterday). The GOLD PRICE ranged from $1,693.30 to $1,645.60 So far, then, both metals are following my interpretation, that they have already bottomed and will not fall lower, therefore it's time to buy.

Both silver and gold rose this week, after making new lows for this move. Yesterday and today both completed key reversals, breaking into new low territory for the move but closing higher yesterday, and closing higher still today.

More than that, both metals left behind clean, plain V-bottoms yesterday. But y'all never mind about silver and gold, y'all go buy lottery tickets. Maybe y'all will hit that $640 million jackpot. You're only about 50 times less likely to hit that jackpot than you are to be struck by lightning.

The GOLD PRICE today rose $17.10 to close Comex at $1,669.30. SILVER PRICE rose 49.1c to close 3246.9c. Gold's low came at a comfortable $1,659.70, and it's high at an ambitious $1,670.40. With a 3211c low silver never dropped below 3200c, and rose 30c higher than yesterday at 3261c.

Nobody much wanted to go home short silver or gold.

UNLESS silver drops below 3150c or gold drops below $1,645, both will not see lower prices. The bottom is in, and it's time to buy.

This does not mean that both metals will immediately surge. We may have several months more of frustrating sideways movement (probably will), but they will keep on edging ever higher. Much higher prices will come before the year dies.

Ahh, there's a lesson on that scoreboard, but what does it teach? Stocks rose amidst crowing over the best first quarter since 1998 (or was it 1898?), silver and gold were taken to the woodshed for a beating but ended the week up (pennies count), and the dollar index finally let go flatlining and fell out of the bed.

Let's start with the disgusting, repulsive fiat currencies before they sink completely out of sight and become extinct.

US dollar index was flat all week but today made a new intraday low for the move. Fell 23.7 basis points (0.3%) to 78.949. Low was 78.727. Lying about 78.30 there appeareth a very important internal support line the dollar dare not cross. If it does, 'twill drop toward 77.50 and the 200 day moving average. Insofar as you can talk about technical analysis in a market so heavily manipulated, you have to expect the dollar to drop more.

The Euro stands at about a 45% correction of the fall from its October high (142.47). It sought to conquer the 50% mark in February but failed. Lower highs make for a downtrend. Closed today 1.3342, up 0.31%, which looks great as long as you don't look at the Spanish real estate bust, the Italian stock market bust, the Portuguese bankruptcy, and all the rest. No direction here but permanently lower.

The Yen fell back through the 20 DMA that it yesterday conquered (121.03) to close down 0.52% at 120.69c (Y82.86). No matter, it bottomed two weeks ago and has advanced ever since. Will go higher -- consistent with the impenetrable aims and purposes of the Nice Government Men's "minds."

Now let's think about stocks -- don't get squeamish on me -- for a few moments. All the folks who sell and tout stocks are all aflutter about this quarter's results. Alas, I bear sober tidings of great sorrow.

Stocks do not begin bull markets from high valuations. Historically, when the S&P500's Price/Earnings ratio reaches 7 or lower, it offers good value and a good buy. Above 20 it's about to crack. At the bust it stood over 40. Today it's at 23.46. Does that sound like the birthplace of a bull market?

Today the Dow Jones Industrial's P/E was 14.79 and its dividend yield was 2.47%. Historically dividend yield has been very low and the market ready to tumble whenever dividend yield reached 3.2% (1929) and ready to be bought when 8% or more. Today it's 2.47%. Bull markets are not born at 2.47% dividend yields.

Today the Dow amidst near-universal jubilating rose 66.22% (0.5%) to 13,212.04. S&P500 ran along with it, gaining 5.19 (0.37%) to 1,408.47.

Yep, both are candidates for double tops. Rally long in the tooth (such teeth as it has left, it's so old), MACD turning down, RSI a little high, and in general rebelling against gravity. BWDIK? I'm only a natural born fool from Tennessee. Haven't even ever OWNED a pair of them shiny, pointy Wall Street shoes.

Listen, I'm not a bird, so I don't tweet very often. But I know a lot of y'all are active on Twitter so I'd be much obliged if you would follow @TheMoneychanger. Who knows, you might see some special offers and announcements every now and again.

Y'all enjoy your weekend!

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

- Franklin Sanders, The Moneychanger
10:00am-5:00pm CST, Monday-Friday

© 2012, 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.

WARNING AND DISCLAIMER. Be advised and warned:

Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.

One final warning: NEVER insert a 747 Jumbo Jet up your nose.