Gold Price Close Today : 1716.60
Change : 8.40 or 0.49%
Silver Price Close Today : 33.707
Change : 0.766 or 2.33%
Gold Silver Ratio Today : 50.927
Change : -0.929 or -1.79%
Silver Gold Ratio Today : 0.01964
Change : 0.000352 or 1.82%
Platinum Price Close Today : 1644.90
Change : 6.40 or 0.39%
Palladium Price Close Today : 699.65
Change : 4.35 or 0.63%
S&P 500 : 1,430.63
Change : 2.79 or 0.20%
Dow In GOLD$ : $159.68
Change : $ (0.63) or -0.40%
Dow in GOLD oz : 7.724
Change : -0.031 or -0.40%
Dow in SILVER oz : 393.38
Change : -8.81 or -2.19%
Dow Industrial : 13,259.61
Change : 11.17 or 0.08%
US Dollar Index : 79.82
Change : -0.232 or -0.29%
The silver and GOLD PRICE have slapped me so many times, but I'm going to try again today. I don't reckon I'll ever learn.
The GOLD PRICE gained $8.40 (0.5%) to $1,716.60 while silver added 76.6 cents (2.33%) to close Comex at 3370.7c. Once again, it begins to look like both metals have bottomed.
Today gold scored a higher high ($1,722.50 v. $1,714.30 yesterday) and a higher low ($1,708.55 v. $1,705.45 yesterday). This leaves behind a double bottom at $1,672.50 in early November and $1,684.10 last week. Stayed well above that $1,705 support.
What's missing? Confirmation by closing over $1,725. However, that's liable to come in a one day jump.
GOLD could only gainsay my interpretation that the bottom is in by closing below $1,705. Otherwise, it will move higher from here.
That SILVER PRICE was jumpy today, and all toward the ceiling. Low came at 3292c in European trading (about midnight NY time). By 9:00 a.m. silver had reached 3325c and was tugging at the leash. Somebody hit it, it fell back instantly to 3300c, then took off for the clouds, gapping and leaping to 3373.2. Rest of the day it backed off, but stayed mostly above 3340c.
'Twas a good day. Great day, matter of fact.
On the 4 month chart silver broke out upside from an even- sided triangle, and stands above its 50 (3298c) and 20 (3335c) day moving averages. Momentum indicators have turned or are turning up. 3400c may snag its feet for a minute, but silver should be headed for 3550c -- SOON.
The comrades on the Federal Open Market Committee announced a boon for the printer's union: more "accommodation." This comes in two forms, (1) the Fed buying Mortgage Backed Securities to the tune of $40 billion a month, and, after December, buying $45 bn a month in long term US treasuries. (Apparently the banks' balance sheets have not been fixed up yet, so the Fed must continue soaking up their bad paper.)
Using my lightning mathematics skills, I make that $85 billion a month of new money the Fed will create, or $1.02 Trillion in 2013.
FOMC also promised "more accommodation" (translation: "creating more money") and that it would keep the Fed Funds rate between zero and one-quarter percent till unemployment (now 7.5%) drops below 6-1/2%.
Now quick! Tell me what $1.02 trillion in new dollars will do to the value of already-existing dollars? There! I see that hand! Yes, it WILL lower the value of all those existing dollars. So all you trembling silver and gold investors who were fretting that the Fed might stop inflating, just rest easy. They just told you they will be inflating away all next year. I keep telling y'all, the Fed and Ben Bernanke are the best friends silver and gold have.
But maybe not stocks' best friends. Dow reached a high of 13,329 today, but finished the day nearer its 13,227 low. Dow gained 11.17 (0.08%) to close 13,259.61. S&P500 rode the same roller coaster, ending up only 2.79 (0.2%) at 1,430.63.
Technically, that performance can be explained another way. The Dow and the S&P500 both hit significant overhead resistance today, at 13,300 and 1,440. Both have reached that "pull the fuse or throw the dynamite" stage, and 'tain't clear to me which choice they'll make. Given the time of year I suspect both will rally further. Besides, both are above all their moving averages, so momentum is up. There's more: both have scratched out unbroken uptrends since mid-November. However, momentum indicators are warning that there's a limit to this rally -- not yet, but shortly.
Naturally the dollar fell like a mule had kicked it in the jaw. Dropped through support at 80 like a man walking into a manhole and lost 23.2 basis points (0.3%) to end at 79.821. Given the FOMC's announcement, I'm surprised it wasn't worse. Gives you an inkling how brain-scrubbed the public is.
What about the other two scrofulous, scabby, no-good, low-down trashy, sorry-as-gully-dirt fiat currencies? Makes little sense: euro rose 0.49%, yen fell 0.77%. At $1.3067 the euro bumped its head plumb against the overhead resistance. If it can break thru, it will sprint for $1.3400. Yen, on the other hand, lost a huge 0.77% to end at 120.26c/Y100. Gapped down again. Now I don't know, but if I were the Japanese Nice Government Men and I saw the dollar dropping and the Fed announcing plans to inflate like a puffer fish, I'd be selling yen and buying dollars to push down the rates. Especially if I ever wanted my economy to export to the US again.
US$1=Y83.15=E0.7653=0.029 667 oz Ag=0.000 583 oz Au.
Just to show you that no matter how healthy an animal or country is, the parasites are always ready to pounce, on 12 December 1791 the First Bank of the United States opened. It was part of the statist Alexander Hamilton's plan to create a central bank. Jefferson and Madison had beaten back the plan a year earlier, claiming the bank was unconstitutional and that it benefited merchants and investors at the people's expense. The bank lasted until its charter expired in 1811. The First Bank of the US was the SECOND attempt at foisting a central bank on the country, after the Bank of North America.
CHRISTMAS IS COMING!
But y'all still have time to order At Home in Dogwood Mudhole for your gift list. There is time, that is, if you act promptly and go to www.dogwoodmudhole.com
Got a complaint from one reader yesterday. She said the book stuck to her hands. Every time she picked it up, she couldn't put it down. Worse yet, she said the folks in the lunch room were looking at her funny because she kept bursting out in fits of laughter.
Don't take my word for it, or hers, either. Go get yourself a copy of At Home in Dogwood Mudhole.
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.