Wednesday, October 24, 2012

The Gold Price Continued it's Correction but is Slowing Silver Also Continues to Fall

Gold Price Close Today : 1708.30
Change : -16.80 or -0.97%

Silver Price Close Today : 31.768
Change : -0.459 or -1.42%

Gold Silver Ratio Today : 53.774
Change : 0.245 or 0.46%

Silver Gold Ratio Today : 0.01860
Change : -0.000085 or -0.45%

Platinum Price Close Today : 1560.20
Change : -12.90 or -0.82%

Palladium Price Close Today : 593.05
Change : -1.10 or -0.19%

S&P 500 : 1,408.75
Change : -4.46 or -0.32%

Dow In GOLD$ : $158.25
Change : $ 1.26 or 0.80%

Dow in GOLD oz : 7.655
Change : 0.061 or 0.80%

Dow in SILVER oz : 411.65
Change : 5.08 or 1.25%

Dow Industrial : 13,077.34
Change : -25.19 or -0.19%

US Dollar Index : 79.91
Change : -0.048 or -0.06%

The GOLD PRICE closed today at $1,700.50, $7.50 lower than yesterday. Silver followed right along, losing 17.5 cents to 3159.5c.

Although the GOLD PRICE is declining less and more slowly every day, sellers continue to batter it relentlessly. This decline is cooked into the market's mind, otherwise today's FOMC announcement -- "We're still going to keep on inflating!" would have kicked gold into high gear.

By "cooked in the market's mind" I mean that rallies and declines, the outcome of thousands of participants, just have to work through the minds of all those people. And humans are herd animals, but who knows why a herd of wildebeests or a flock of blackbirds or a school of salmon all wheel right or left at once in perfect unison? Nobody, but they do. So we have to patiently wait until markets reach the inevitable excess in one direction before they turn and go the other. It's a mystery, like why any woman would every love any man, or why my wife loves me -- but she does.

The GOLD PRICE decline is decelerating, but as it stands below its 20 DMA ($1,757.12) and 50 DMA ($1,726) momentum is dragging it down.

Where might it halt? Just below $1,700, about $1,690, there was a tussle on the way up. Then comes $1,680, where over the past 16 months many other battles have been fought. Below that the 150 DMA ($1,650) and 200 DMA ($1,663.80) are waiting to catch gold. That level also marks a 61.8% correction.

RSI and MACD indicators have dived deep, but have not yet signalled an upturn.

For those outraged by silver's fall, I'd remind y'all that it is up 21% from its July 2610c low. All things considered, not so terrible.

For the SILVER PRICE 3200 cents has become a portal barred and locked. Today's low came at 3153c. Silver has already fallen below its milestone 300 DMA (3197c). Don't panic, a return for a last kiss good-bye is frequent. 200 DMA stands beneath to catch silver at 3098c. Beneath that the uptrend line from the July and August lows stand about 2950. And there's more support from the summer highs around 2840c.

Most of all, SILVER IS IN A BULL MARKET. In bull markets, corrections always eventually resolve by turning up. Same holds for gold.

I know waiting through these corrections is almost as much fun as wearing towsack underwear, but it shouldn't last much longer now. Better yet, we are going to get an opportunity to buy much more silver and gold, more cheaply.

Surprise, surprise: the world's still going to hell in a handbasket, and the Federal Reserve Open Market Committee did nothing to stop its slide. They're just going to keep on pouring voltage to the printing machines.

I'm not sure exactly where the US dollar index closed but right now it's trading 4.8 basis points lower than this time yesterday, at 79.912. High today was 80.151, with a much higher low at 79.82. Dollar is tugging at the leash to go higher.

Currencies: US$1.00 = Y79.80 = E0.7707.

Euro looks like too-old baloney in the meat cooler, with that greenish glaze on it. Closed today at $1.2975, down 0.8%. No significant move, but traded below its 20 DMA (now 129.69) most of the day, then closed not far above. Not optimistic, when the trend is down.

After a nasty plunge through most of October, the Yen appears to have hit pavement. Today it gained 0.8% to to 125.31 cents per 100 yen.

None of these currency charts are artifacts of nature. They all bear the scars of frequent government interventions. Things would probably be worse, but the US presidential election keeps enough uncertainty beclouding markets that few are brave enough to take large new positions. Safer to sit it out and see who wins.

I know it makes y'all REALLY mad for me to say it makes no difference who wins, and I have received more than one smoking, glowing email to that effect. Friends, I would it were no so, but 'tis, and my lying about it won't change it a whit. For instance, if Mitt with Grit got elected, will he abolish the Federal Reserve? Restore constitutional silver and gold money? Pull the troops back from the 700 imperial overseas bases? Reduce government spending during a depression when over 50% of U.S. income arises from state and local and federal government spending? Will he purge the tapeworm banks from the nations' bowels? He won't -- he won't be allowed to -- do anything more dramatic than changing the trim on the White House curtains. All of these things are built into the structure of the US economy, and it will dry up and blow away without that inflation and government spending and war. Changing the captain on the Titanic while it's sinking won't help a bit. I'm sorry if my telling you that offends you, but it is the truth learned the hard way. Politics is a false messiah.

Everybody has to learn that it's a delusion to believe the politicians are coming to save you or the country. Y'all had better be figuring how you can save yourself, your family, your neighbours  and your community. You rebuild your own community and the nation will take care of itself.

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. No, I don't.