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Thursday, May 10, 2012

The Gold Price Closed Comex $1,595.10 Silver and Gold Ready to Rise

Gold Price Close Today : 1595.10
Change : 1.40 or 0.09%

Silver Price Close Today : 2913.6
Change : 6.1 cents or -0.21%

Gold Silver Ratio Today : 54.747
Change : 0.162 or 0.30%

Silver Gold Ratio Today : 0.01827
Change : -0.000054 or -0.30%

Platinum Price Close Today : 1485.70
Change : -12.70 or -0.85%

Palladium Price Close Today : 614.85
Change : 0.85 or 0.14%

S&P 500 : 1,357.99
Change : 3.41 or 0.25%

Dow In GOLD$ : $166.60
Change : $ 0.13 or 0.08%

Dow in GOLD oz : 8.059
Change : 0.006 or 0.08%

Dow in SILVER oz : 441.21
Change : 1.61 or 0.37%

Dow Industrial : 12,855.04
Change : 19.98 or 0.16%

US Dollar Index : 80.17
Change : 0.310 or 0.39%

I the silver and GOLD PRICE with a better will and more gladsome mind than I've had in more than a week.

I watched them trading this morning from early on. About 6:00 a.m. EDT the GOLD PRICE hit the trough of a fall from $1,596 to $1,585.90. From there it rose strongly until it peaked at $1,600.90 just before 10:00. Dropped back to $1,592, then oscillated between $1,597 and $1,592 the rest of the day. Comex closed up $1.40 at $1,595.10. That's all well and good, but that's not really what my eye was feeding on. Let me tell you about silver first.

The SILVER PRICE ended the day 6.1c lower at 2913.6c.

Silver's progress mirrored gold's, with a fall from 2935c about 4 a.m. to 2893c about 6:00 a.m. Climbed till 10 up to 2945c, then backed off to end the day spinning between 2910 and 2895c.

Here's what I watched unfold on silver's 5-day chart that entranced me. Tuesday had traced out a mid day low about 2910c, an upside down left shoulder perhaps? Wednesday declined and drew out a head with a mid-day low about 2860c, then it climbed over 2920. Today it traced out the second (right) shoulder with a low at 2893c and a rise to that neckline at 2945c. More than that, the shoulder itself was formed as an upside down head and shoulder as I watched, like nesting Russian dolls. Gold's chart was not as pellucid, but followed the same pattern.

Now all this will be moonbeams and gainsaid if silver breaks 2995 tomorrow. On the other hand, it could found a rally that would reach at least 3040c before it stops.

If you are short silver, or intend to buy more, this constellation favors taking a chance. On gold, too.

GOLD/SILVER RATIO
today closed at 54.747, and I am really tiring of waiting for a higher ratio. Ratio can turn and savage you -- fall like a brick -- without warning. If you swapped silver for gold at 49.80 last year, you can swap back into silver today with a 12.6% profit. Best think hard about taking the profit and scooting.

My, O, my, finally an interesting day! Nothing seen clearly yet, but the haze is beginning to dissipate. Maybe.

US DOLLAR INDEX barely rose, 3 basis points to 80.169. That was enough room for all the markets battered for the last 8 days to lift their heads up for a breath.

Dollar now at a crossroads where it will either advance toward 89, or fall away toward the 2008 low near 70. No, I don't know which, but lean toward the rally, which would last probably six months, although it hard to imagine that anybody would want to hold dollars if O'Bama is re-elected in the fall. Rally will blow a headwind against silver and gold, but they've already reached their bottoms, although it will be a long, painful climb back to their last highs and above. That could well eat up another six months.

Euro bounced today, not high enough to change anything. Yen lost 0.46% to 125.02c (Y79.99/US$1). Still points toward the clouds.

Like the famous cat dropped from a ten story building, STOCKS bounced today. Bounce took the S&P500 up for a (likely) kiss good-bye to the neckline it fractured two days ago on its way to meet gravity at the earth's core. Dow still has not reached the neckline with its final (right) shoulder, but it stands outside hailing distance of its 50 DMA (13,055) and 20 DMA (13,050), so inertia is pulling it down.

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

- Franklin Sanders, The Moneychanger
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© 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. No, I don't.