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Wednesday, May 16, 2012

The Gold Price Down and Monstrously Oversold as Euro Crisis Looms Must Rally Soon

Gold Price Close Today : 1536.20
Change : (20.60) or -1.32%

Silver Price Close Today : 2717.00
Change : 88.4 cents or -3.15%

Gold Silver Ratio Today : 56.540
Change : 1.047 or 1.89%

Silver Gold Ratio Today : 0.01769
Change : -0.000334 or -1.85%

Platinum Price Close Today : 1422.90
Change : -36.00 or -2.47%

Palladium Price Close Today : 589.30
Change : -10.50 or -1.75%

S&P 500 : 1,324.80
Change : -5.86 or -0.44%

Dow In GOLD$ : $169.53
Change : $ 1.82 or 1.08%

Dow in GOLD oz : 8.201
Change : 0.088 or 1.08%

Dow in SILVER oz : 463.69
Change : 13.42 or 2.98%

Dow Industrial : 12,598.55
Change : -33.45 or -0.26%

US Dollar Index : 81.44
Change : 0.180 or 0.22%

The GOLD PRICE made a low at $1,527.70, practically on my target. Silver posted its low at 2676 c, not far off 2615c support.

Both the silver and GOLD PRICE are coasting along on their bottom Bollinger Bands, something that hasn't happened since fall 2008. Implication? Silver and gold are monstrously oversold, and will shortly come roaring back with a rally, even if only a temporary one.

End of this decline ought to come within a week at most, but that euro crisis hangs over everything, scaring everyone to death, much like the 2008 panic in the US.

Against moving averages the SILVER PRICE has moved to its percentages posted at the December low, and a little further. This must stop soon, or suffer another big slide. I am voting for "stopping soon", because the ECB has pumped massive new money into banks, and should the euro crisis threaten contagion, Ben the Bernancubus will start printing money as if he were Ben Franklin and his own picture was on the bills.

GOLD/SILVER RATIO continues to rise, closed today at 56.540. If you swapped silver for gold within the last 18 months, right now you ought to be swapping back.

Today I am finishing my monthly Moneychanger newsletter for paid subscribers, so have very little time. US Dollar index continued to gain today, more evidence that fear is strangling markets.

Hang on, don't lose your head. One of these days all this pain will be past.

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.