Friday, April 13, 2012

Gold Price Rose 1.9 Percent for the Week to Close at $1,659.10 Must Hold Above $1,613

Gold Price Close Today : 1,659.10
Gold Price Close 5-Apr : 1,628.50
Change : 30.60 or 1.9%

Silver Price Close Today : 3138
Silver Price Close 5-Apr : 3171.6
Change : -33.60 or -1.1%

Gold Silver Ratio Today : 52.871
Gold Silver Ratio 5-Apr : 51.346
Change : 1.52 or 3.0%

Silver Gold Ratio : 0.01891
Silver Gold Ratio 5-Apr : 0.01948
Change : -0.00056 or -2.9%

Dow in Gold Dollars : $ 160.10
Dow in Gold Dollars 5-Apr : $ 165.78
Change : $ (5.68) or -3.4%

Dow in Gold Ounces : 7.745
Dow in Gold Ounces 5-Apr : 8.020
Change : -0.27 or -3.4%

Dow in Silver Ounces : 409.48
Dow in Silver Ounces 5-Apr : 411.78
Change : -2.30 or -0.6%

Dow Industrial : 12,849.59
Dow Industrial 5-Apr : 13,060.14
Change : -210.55 or -1.6%

S&P 500 : 1,370.26
S&P 500 5-Apr : 1,398.08
Change : -27.82 or -2.0%

US Dollar Index : 79.888
US Dollar Index 5-Apr : 80.070
Change : -0.182 or -0.2%

Platinum Price Close Today : 1,581.60
Platinum Price Close 5-Apr : 1,600.00
Change : -18.40 or -1.2%

Palladium Price Close Today : 643.20
Palladium Price Close 5-Apr : 646.10
Change : -2.90 or -0.4%

SILVER and GOLD PRICE dropped today. Silver lost 3.5% and gave up 113.5c, all the 100.4c it had gained yesterday and then some, closing at 3138c. GOLD PRICE gave back $20.40, virtually all the $20.50 it had gained yesterday, and closed at 1,659.10.

None of this was good, but also not nearly fatal. The GOLD PRICE low today at $1,649.40 matched yesterday's. Gold continues in the same situation that has lasted all week: as long as it remains above $1,630, it is trending up. Clearly a line in that battle has been drawn at $1,650, so if gold crumples there on Monday, it promises to sink all the way to $1,630.00

This week the GOLD PRICE has reached the 38.2% correction of its Sept -Dec. fall. More, it stands under a cluster of converging moving averages -- 50, 150, and 200 -- and strong lateral resistance at $1,682. Of course I know that this sideways movement is frustrating, but as long as it remains above $1,613 gold will keep on rising.

On a less cheery note, the 3 year weekly gold chart shows what MIGHT be a breakdown. A close below $1,613 would confirm that breakdown and then we've got a painful mess. If that mess didn't catch at $1,525 (last low), it could drop to $1,475. that would finish off a monstrous bullish falling wedge which then would explode upside.

Now I know every one of us hears the LAST thing we're told, so right now y'all run back and read the next to the last paragraph. I expect $1,613 to hold.

Thinking about the weekly chart, look at the SILVER PRICE weekly chart, where a different picture emerges. There silver has formed a long even-sided triangle, from which it will break out to the upside. No talking out of both sides of the mouth there. Silver whispers gold will not drop.

Silver's 5-day chart looks unnatural. Flat as a fritter between 3190 and 3100 Monday through half of Thursday, then a straight up leap to 3250, and a fall off today to 3138c. Stay with this: silver must hold 3100c. Close below that pulls silver down. No close below that, silver will move sideways or rise.

Don't miss the Dow in Gold Dollars, which dropped the week G$5.68 (0.249 ounces). It is trying to break down.

End of the SILVER and GOLD correction draweth nigh. Lower prices are offering you one last chance to buy a cheap ticket for the bull ride.

Sometimes when everything is dragging the ground, you have to ask yourself which is the least worst.

On bad news out of Europe today (surprise, surprise) the dollar jumped while stocks tanked.

I wonder some times if the Nice Government Men "tasked" with manipulating the dollar have some Big Hancho In Charge ("Big Hick") who at the end of the week looks at the market and "adjusts" it. Why am I so durned suspicious? Well, the nasty US Dollar index traded down, down this week, made a new low for the move which in any free market would have sent it shooting lower after breaking the 20 and 50 day moving averages, but today did it sink like a watch in a churn? Nope, rose 54.9 basis points (0.71%) to 79.888. What can I say? Only note with distaste and disgust that the dollar must rise over 80 to turn up, and close below 78.50 to break down.

Japanese yen has reached the 124 level and stalled, sliding down the underside of its 50 DMA. Last three days Yen has remained virtually flat, and today closed 123.69c against yesterday's 123.66c, against Wednesday's 123.60c. One begins to wonder if the rally we have seen was no more than an upward correction in a longer down move.

News leaked out today that Spanish banks' borrowing from the European Central bank surged to new highs in March. The capitalist rats are leaving the socialist ship, pulling money out of Spanish banks and leaving them on the mercy of the ECB for funding Spanish stocks dropped 3.6% today (think a 450 point drop in the Dow) to a new 3 year low as Spanish bond yields reached for 6%. Credit Default Swaps on Spanish debt reached their highest price on record. Italian bond yields rose and all Euro stock markets shrank. All this places Spain on the candidate list for Next European Bailout, and helps explain why the euro fell 0.8% today to $1.3081. If you have euros, sell 'em.

Monday's fall and the rest of the week's weakness (owch! Sorry) leave behind a double, maybe triple, stop in the Dow. Can't yet write out of the picture a possible brief surge to 13,300 or higher (only a close below 12,250 would do that), but stocks look sick.

Today the Dow lost 136.99 (think 1.05%) to close at 12,849.59. S&P500 closed down 17.31 or 1.25% at 1,370.26.

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.