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Tuesday, September 25, 2012

Gold Price Rose $1.70 to $1,763.80 Correction still Looks Likely

Gold Price Close Today : 1763.80
Change : 1.70 or 0.10%

Silver Price Close Today : 33.886
Change : (0.035) or -0.10%

Gold Silver Ratio Today : 52.051
Change : 0.104 or 0.20%

Silver Gold Ratio Today : 0.01921
Change : -0.000038 or -0.20%

Platinum Price Close Today : 1631.80
Change : 9.80 or 0.60%

Palladium Price Close Today : 639.70
Change : -4.65 or -0.72%

S&P 500 : 1,441.59
Change : -15.30 or -1.05%

Dow In GOLD$ : $157.72
Change : $ (1.33) or -0.83%

Dow in GOLD oz : 7.630
Change : -0.064 or -0.83%

Dow in SILVER oz : 397.14
Change : -2.58 or -0.65%

Dow Industrial : 13,457.55
Change : -101.37 or -0.75%

US Dollar Index : 79.59
Change : 0.049 or 0.06%

The silver and GOLD PRICE charts don't offer much more comfort today. Gold rose $1.70 to $1,763.80 while silver lost 3.5 cents to 3388.6c. The GOLD/SILVER RATIO rose ominously from 51.947 to 52.051.

The GOLD PRICE five day chart shows that peak above $1,785 Friday, a crash to $1,755 over the weekend, and a recovery today to $1,775. Today it also backed off to close at the range's lower end. $1,755 is now the sling underneath as $1,775 is the canopy overhead. A break below $1,755 -- today's low was $1,758.96 -- would send gold to visit $1,720 right quickly. 20 DMA stands at $1,732.05., so a drop to $1,720 would turn gold decidedly lower.

That all important 150 day moving average is now paralleling the 200 DMA, $1,641.66 to $1,648.25. That would be a logical safety net for gold should it pierce $1,720.

Nix all the above and buy gold both-handedly if the GOLD PRICE closes above $1,885.

Like gold, the SILVER PRICE 5 day chart also shows a declining right triangle, with lower tops and a floor about 3360. Should silver break 3360c, the 300 DMA stands ready to catch it at 3240c. If that fails then 3100 - 3050c ought to stop it.

If you go in for Fibonacci or other fizzly drinks, ponder that 3200c corrects the foregoing move by 38.2%, 3100c by 50%. That offers those levels as targets, too.

Dealing in words, I am REALLY picky about using them correctly. Thus was I instantly appalled this morning listening to National Proletarian Radio (Motto: "Using your tax dollars to promote socialism and statism"). They were discussing the ongoing economic "crisis."

Crisis? Ongoing? That's a contradiction in terms, for, LO! a "crisis" is a "turning point," "a condition of instability leading to a decisive change," or, medically "the point in a serious disease's course when a decisive change occurs, either to recovery or death."

So subtly have the bureaucrats and central bankers and statist cheerleaders tortured this poor word "crisis" that it ceases to have meaning, no, worse still, it has come to signify a PERMANENT condition. Never comes the turning point, never the decisive change, only the eternal emergency, which they must manage.

And of course y'all remember, "Necessitie, the tyrant's plea?" Emergency, like war, wraps all sorts of tyranny in the toga of righteousness and patriotism. Yet when you lift the toga, underneath dwelleth still the same old fascists.

Crisis, indeed.

US dollar index, keeping its snail-ish rally running, added 5 basis points (0.6%) today to end at 79.593. Worse, it appears to be rolling over downward on the five day chart. Yen gained 0.7% to 128.54c (Y77.80), still fluttering below the downtrend line. No news until it breaks above 130 or below 127. Yawn. It's been a rough six days for the euro. Dropped 0.22% again today to close at $129.03 (E0.7750). Barely hovering above 200 day moving average (128.38) and 20 DMA (128.21). Sliding down the downtrend line. Tears lurk in its scrofulous future.

The five day Dow chart shows a head and shoulders top with a neckline about 13520. Today the Dow broke that neckline and plunged to a 13,457.49 low, closing just 0.10 point higher. This smashing fall took the down 101,.37 or 0.75%.

Today was even more cruel to the S&P500. It lost 15.3 (1.05%, whew!) to 1,441.59.

Who am I, natural born fool from Tennessee, to parse the import of these moves? Well, I am fool enough to hazard a guess. All y'all who've pinned on stocks the hopes the hopes for your retirement and later happiness in life don't get too mad at me. I've been warning y'all.

Charts for both S&P500 and Dow have traced out near identical patterns. They rose off a June low to create a long rising wedge, then bumped up and through highs for the year. Bear in mind that they might still reach for slightly higher highs, but for right now the chart unfolds only bad news. After trading in an island type pattern (suspect for a reversal), both have traded back down into their rising wedge. For the S&P500 the rising bottom boundary of that wedge (itself no happy omen) hits today about 1,425, and for the Dow about 13, 350. Closes below those push both over a very sharp cliff toward the rocks below.

Again I mention that stocks measured in gold are trading below their 200 day and 20 day moving average, having broken down after a long topping process. Might turn up for a final kiss of that 200 DMA, but might just keep on falling like your car keys down a well.

This is getting to be too much fun. Delaware, Maine, and Louisiana all showed up to order At Home In Dogwood Mudhole today, not to mention our first order from Russia.

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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.