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Friday, November 30, 2012

The Silver and Gold Price Have Begun Their Next Leg Up I'm Still Buying Silver and Gold

Gold Price Close Today : 1,710.90
Gold Price Close 23-Nov : 1,751.40
Change : -40.50 or -2.3%

Silver Price Close Today : 3320.4
Silver Price Close 23-Nov : 3411.6
Change : -91.20 or -2.7%

Gold Silver Ratio Today : 51.527
Gold Silver Ratio 23-Nov : 51.337
Change : 0.19 or 0.4%

Silver Gold Ratio : 0.01941
Silver Gold Ratio 23-Nov : 0.01948
Change : -0.00007 or -0.4%

Dow in Gold Dollars : $ 157.38
Dow in Gold Dollars 23-Nov : $ 153.55
Change : $ 3.83 or 2.5%

Dow in Gold Ounces : 7.613
Dow in Gold Ounces 23-Nov : 7.428
Change : 0.19 or 2.5%

Dow in Silver Ounces : 392.29
Dow in Silver Ounces 23-Nov : 381.34
Change : 10.95 or 2.9%

Dow Industrial : 13,025.58
Dow Industrial 23-Nov : 13,009.68
Change : 15.90 or 0.1%

S&P 500 : 1,416.18
S&P 500 23-Nov : 1,409.15
Change : 7.03 or 0.5%

US Dollar Index : 80.232
US Dollar Index 23-Nov : 80.267
Change : -0.035 or 0.0%

Platinum Price Close Today : 1,603.10
Platinum Price Close 23-Nov : 1,615.10
Change : -12.00 or -0.7%

Palladium Price Close Today : 686.25
Palladium Price Close 23-Nov : 667.60
Change : 18.65 or 2.8%

'Twas a hard week for the silver and GOLD PRICE, I'll explain why not as hard as it may seem.

Silver and gold hardly ever ever decline into the year end. Also in the longer term charts: No damage has been done. Rather, the metals have merely touched back to support: support that has held so far.

What of today? Silver lost 114.4c to 3320.4c while the GOLD PRICE lost $16.30 to close Comex at $1,710.9. This painted a pretty tape, but in the aftermarket gold was trading at $1,714.01 and silver at 3339c. Not exactly cowering.

Critical support in gold, bear in mind, is $1,705. Low today hit $1,708.68, which was higher than Tuesday's $1,705.20. So gold has posted either double bottom or slightly higher lows.

Coming out of European trading gold was doing just fine, thanks, betwixt $1,727 and $1,731. Lo and Behold, about the time Comex opened in New York, somebody started selling, taking gold down to $1,720 by 8:30. Another bout of selling hit just before 11, gapping gold down from $1,724 to $1,719. Declined into $1,708.68 about 2:30, and rose after the close.

Today's decline merely took gold for another kiss on the neckline of that inverted head and shoulders, although it did pull it back beneath the 20 DMA ($1,722.76).

The bounds are clear: gold must not break $1,705.50. Otherwise it drops to $1,665 (200 DMA) or uptrend line from the June low (now about $1,640, but rising). Overhead gold must -- must clear $1,755, the last high. This needs to happen soon. Next week.

The SILVER PRICE five day chart doesn't look at all like gold's. Where gold shows a push off a cliff, silver's shows a V-bottom on Wednesday, with a sharp recovery yesterday and fall today to a HIGHER low than Wednesdays (3318c against 3291c).

One day chart shows silver cruising along fine above 3400c until about 9:45 NY time, when it gapped down to 3380c, hovered, then gapped down again to 3340c. Final erosion by 1:15 had dragged silver down to 3318c and the low. In the aftermarket it climbed to 3340c.

No problem at all appears on the 4 month SILVER chart. It began an uptrend off the 2 November low at 3066c, and if you draw a line under the lows, today's low stopped short of that uptrend line. Whoops, it also stopped shy of the 50 day moving average (3315c). Shows a market correcting, but refusing to break down.

What are the bounds? Silver must not close below that uptrend line, call it the same level as the 50 DMA (3315c), period. Should it breach that mark, could fall to the rising trendline form June's low and hit that about 3025c today.

The difference between a fool and a brave man charging into a cannon's mouth is whether he comes out alive. This is a risk I would take. Silver and gold have begun their next leg up, the correction lies in the past, seasonality is pushing them higher.

I'm still buying silver and gold, and more whenever they become cheaper. Let the croakers croak, let the squawkers squawk, let the whiners whine. They were all doing that same thing when gold was $252 and silver $4.01. Veritas filia temporis.

Stocks didn't prosper this week, closing a bare few points higher this week than last. Only palladium managed to rise. Biggest surprise was the US dollar, which, contrary to all expectation, justice, and gravity did not flow down the sewer this week.

First, the currencies. The ugly dollar index traced out a head and shoulders top this week with a neckline at 80.05. What meaneth this? That the dollar index is highly unlikely to rise above 80.30, the top of the shoulders, and virtually assured to drop below 80.05. Of course, when the Nice Government Men are in the market pushing things this way and that for their own inscrutable but invariably nefarious ends, it may take a while for that technical bent to work itself out, but it will at last.

Euro is poking at the downtrend line and overhead resistance, but keeps proving incapable of any meaty advance. Will probably jump one day next week, but I doubt that will last. Rose 0.08% today to $1.2988.

After a five day rise the yen fainted again today, gapping down for a new low for the move at $121.26c/Y100, down 0.44%. I very much doubt the NGM around the world will stand by idle while the Japanese hone their competitive advantage by depreciating their currency below 118c/Y100. That's what I love to watch: the Midianites and Amalekites start fighting each other.

US$1=Y82.47=E0.7699+.030117 oz Ag=0.000584 oz Au.

I don't talk much about manipulation in silver and gold, because it doesn't take much talent or imagination merely to blame everything on the secret manipulators. Oh, yes, they manipulate the markets, but with that same success that attends all government efforts, keeping the gold price down from $252 in 2001 to $1,710.90 today and silver from $4.01 to $33.204 today. Yet they do manipulate them over the short term, and try to hit them at critical junctures, as when Gold is fixing to break over $1,800 and silver over $37.50. What success attends their wretched frauds, I have already pointed out.

Stocks rose for the week, but have not yet made good their escape from beneath the drowntrend line. Dow added 3.76 today to 13,025.58 and S&P500 added 0.23 to 0.03%. Stocks will rally into year end, a bootless exercise.

Y'all enjoy your weekend.

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.