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Monday, December 03, 2012

The Gold Price Closed Up But can it Climb to $1,755 and Better it's Last Peak?

Gold Price Close Today : 1719.60
Change : 8.70 or 0.51%

Silver Price Close Today : 33.681
Change : 0.477 or 1.44%

Gold Silver Ratio Today : 51.055
Change : -0.471 or -0.91%

Silver Gold Ratio Today : 0.01959
Change : 0.000179 or 0.92%

Platinum Price Close Today : 1612.30
Change : 9.20 or 0.57%

Palladium Price Close Today : 689.45
Change : 3.20 or 0.47%

S&P 500 : 1,409.46
Change : -6.72 or -0.47%

Dow In GOLD$ : $155.86
Change : $ (1.50) or -0.95%

Dow in GOLD oz : 7.540
Change : -0.073 or -0.95%

Dow in SILVER oz : 384.95
Change : -7.34 or -1.87%

Dow Industrial : 12,965.60
Change : -59.98 or -0.46%

US Dollar Index : 79.92
Change : -0.064 or -0.08%

The GOLD PRICE added $8.70 to $1,719.60 and silver gained 47.7 cents to 3368.1. That thrills me none at all.

Today I am going to tell y'all all the things I DON'T like about silver and gold right now.

The GOLD PRICE chart has become equivocal. The MACD might be fixing to blow a negative crossover. The RSI is drifting. Gold has been moving sideways since mid October, and last week, after outlining an upside down head and shoulders, came back to the neckline rather than breaking away from it. Nasty too, is gold's location below its 20 DMA ($1,724.92).

Today gold closed up $8.70, but without enough skyward conviction to get over $1,725 resistance and that 20 DMA.

Nothing goes sideways forever. The GOLD PRICE must either climb to $1.755 and better that last peak, or fall back toward the early November low at $1,672.50.

There are things I don't like about silver, too, but not as many. RSI is headed down from a November high. MACD might be crossing over downside. Volume is rising on the falls, and falling on the rises, like gold's.

But the SILVER PRICE also offers things to like, things gainsaying gold's gloom. Silver has unequivocally trended up since that early November low, up and out of that upside-down head and shoulders, as it should. It stands above its 20 DMA (32.97) and 50 DMA (3314c).

What I don't like about silver's strength against gold's is that often -- not always, but often -- silver strength appears late in any move. But silver can also lead the way up early in a rally, too.

I went back and checked the bull market Decembers, those through 2001. I keep telling y'all that December normally is a strong month seasonally for silver and gold, but I hadn't looked at it from this angle. I compared the last trading day of November to the last trading day of December. Of those 11 years, both metals rose seven years out of eleven. All Decembers averaged for silver show a 0.65% rise and for gold 1.06%. Average of the downs took silver lower a painful 12.36% while the up years saw it gain 8.9%. Gold's average of losing Decembers was -6.08%, of gaining Decembers plus 5.14%.

Of course, those are all just dead numbers. An average takes a fellow who makes $15,000 a year and adds him to a fellow making $1,000,000 a year and invents a mythical man who makes $507,500 a year. That predominance of up Decembers carries more weight with me.

What persuades me more that I am right and that the next big silver and gold rally has begun is that all this is happening after a 1-1/2 year and 1 year correction in silver and gold. Just not time for another big fall, unless something goes horribly awry.

Here are the boundaries: gold must clear $1,755 and not fall through $1,705. Silver must o'erleap 3450c and must not fall below 3314c (50 DMA and uptrend line). In any event, those "averages" I quoted say that the maximum downside for silver is 2910c and for gold is $1,594. Gold will lay bare its intentions in the next day or two.

If they break, likelier downside targets are support at $1,640 and 3050c.

Bear in mind I'm not an optimist or pessimist on silver or gold, I am merely riding the bull market and for entertainment meantime reading the charts. It appears to me still that the correction from the August-September rise has been completed, but another leg down is possible. Longer metals stall here, more likely that becomes.

Now here's a news item that would warm a banker's ventricles: Fannie Mae and Freddie Mac, the Franken-lenders sponsored by the yankee government, will suspend "some" foreclosures for the holidays. Just brings a tear to the eye, don't it?

The US dollar index at last fell through support at 80, which might break up the congestion in other markets. Closed today at 79.917, down 6.4 basis points, not a significantly sized drop but a significantly placed one. Punches through the 50 day moving average and that mid channel support reaching back to July 2011. Bad juju. Dollar is straining at the leash to move lower.

Yen and Euro fed off the dollar's fall. Euro climbed 0.52% to $1.3055, through $1.30 and all the way to the short term downtrend line from the previous two peaks. If the euro can burst that resistance, it can reach $1.3400.

Yen rose 0l30% to 121.62 cents/Y100. That filled the gap left on Friday, but not much more.

US$1=Y82.22=E0.7660=0.029 690 oz Ag=0.000 582 oz Au.

Stocks finally breached the downtrend line last week, but couldn't guess what to do today. Dow lost 59.98 (0.46%) to 12,965.60, closing below its 200 DMA (12,996). S&P500 looks much better. It lost 6.72 (0.47%) to 1,409.46 and remains above both its 200 DMA and 20 DMA, and today actually touched its 50 DMA. Don't let my kind words confuse you: I still don't want to own stocks.

Stocks valued in silver and gold are near the bottom (and past, for gold) of a congestion stretching back to September. Next big move will be down.

AT HOME IN DOGWOOD MUDHOLE

Because I like to put my money where my mouth is, I asked my design genius Collin the Magnificent to put up a website at www.dogwoodmudhole.com. There you can read not a measly first page or copyright page or chiseling title page like you get on Amazon, but an ENTIRE chapter called "Pig Persuader." If you read it and don't laugh out loud at least once, probably with loud snorting, I will send you a quarter. And all the rest of the book is just as good, lots of it better, but this is one of my personal favorites.

Go. Read. Buy At Home In Dogwood Mudhole. Unsolicited one reader wrote me that he had laughed himself "SILLY" reading it. More than one reader has bought a case or half a case, reckoning they could give no better Christmas gift. I am humbled and gratified, and I bet if you'll read that chapter, you'll like it too.

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

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com
1-888-218-9226
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.