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Friday, January 18, 2013

The Gold Price Bottomed on January 4th Rising $26.60 this Week Buy Silver and Gold Period

Gold Price Close Today : 1,686.60
Gold Price Close 11-Jan-13 : 1,660.00
Change : 26.60 or 1.6%

Silver Price Close Today : 31.90
Silver Price Close 11-Jan-13 : 30.37
Change : 1.535 or 5.1%

Gold Silver Ratio Today : 52.868
Gold Silver Ratio 11-Jan-13 : 54.665
Change : -1.80 or -3.3%

Silver Gold Ratio : 0.01891
Silver Gold Ratio 11-Jan-13 : 0.01829
Change : 0.00062 or 3.4%

Dow in Gold Dollars : $ 167.30
Dow in Gold Dollars 11-Jan-13 : $ 167.97
Change : -$0.67 or -0.4%

Dow in Gold Ounces : 8.093
Dow in Gold Ounces 11-Jan-13 : 8.126
Change : -0.03 or -0.4%

Dow in Silver Ounces : 427.86
Dow in Silver Ounces 11-Jan-13 : 444.18
Change : -16.32 or -3.7%

Dow Industrial : 13,649.70
Dow Industrial 11-Jan-13 : 13,488.43
Change : 161.27 or 1.2%

S&P 500 : 1,485.98
S&P 500 11-Jan-13 : 1,472.05
Change : 13.93 or 0.9%

US Dollar Index : 80.030
US Dollar Index 11-Jan-13 : 79.564
Change : 0.466 or 0.6%

Platinum Price Close Today : 1,672.10
Platinum Price Close 11-Jan-13 : 1,629.30
Change : 42.80 or 2.6%

Palladium Price Close Today : 722.00
Palladium Price Close 11-Jan-13 : 700.70
Change : 21.30 or 3.0%

The GOLD PRICE high came at $1,695, low at $1,684.70. Trying to remain sober, I note that gold has enjoyed 4 upweeks out of the last four. However, momentum indicators like the MACD and RSI, with plenty of room to rise. Then I think about GOLD punching at the top of its Bollinger Bands and cool a little. So maybe gold will take a breather next week, move sideways before it takes off again.

The mark for gold to beat has become $1,705. A close over that will attract lots of buyers, a close over $1,730 flocks of 'em.

SILVER PRICE gained 11.6 cents today to close Comex at 3190.2c. Gold lost $3.80 to close at $1,686.60, still above that early December low.

SILVER PRICE is in the same position as gold, strong momentum indicators and above all its moving averages except the 50 day. Looks ready to rise.

A GOLD PRICE close above $1,705 will carry gold immediately higher. A close below $1,685 sets the stage for a modest fall, maybe to $1,660.

I believe the bottom for the correction from the October highs came on 4 January. Buy silver or gold, period, but especially on any price retreat. The party has kicked off again.

I know a trader who says, "The week never lies." That is, you can't argue with a scoreboard.

This week silver showed up on that scoreboard as the clear winner, up 5.1%. Gold gained 1.6%. Stocks, for all the jubilating and publicity, gained 1.2% (Dow) and 0.9% (S&P500). US Dollar index came back to life today, and platinum and palladium roared.

You won't understand what's going on unless you note that in spite of stocks' gains this week, the Dow in Gold and the Dow in Silver FELL.

US DOLLAR INDEX finally broke through 79.80 resistance and jumped to touch 80.187,although it has backed off now to 80.03, up 31.6 basis points (0.41%). 80 now becomes support.

I hate dealing with these old nasty currencies. It's like sorting cow pies, and, worse yet, they're driven by political central bank policies you can never discern from a chart.

They're all mixed up now. Dollar won't rally, and won't break down. Stuck Euro rallies, then changes its mind -- twice over. It closed down 0.43% today to $1.3316. Apparently the Keynesian lamebrains running the US government and Fed don't care that the Japanese have cheapened their currency by nearly 15% since September, by the mere swirling of paper gaining a competitive advantage over US manufacturers. But shucks, these and earlier lamebrains -- including ESPECIALLY the Republicans back to Reagan -- have already sent most US manufacturing overseas by currency and tariff manipulations. I don't know how an occupying army could have done the U.S. more damage. Whose side are they on? Not ours.

Yen lost another 0.27% to close at 111.03 cents/Y100. I hope y'all like flipping hamburgers for a living.

Stocks this week made a new high for the rally that begin in mid-November, and slightly bettered the high from October. Then today they added modestly to that. Dow gained 53.68 (0.39%) to 13,649.70 while the S&P500 gained 0.34% (5.04) to 1,485.98.

Question now becometh, Can they reach new highs higher than the October 2007 high (intraday 14,198.10)? Recalling that the Dow has traced a massive broadening top or megaphone Jaws of Death formation, it really won't matter. That would be the ideal ploy for a bear market to suck in more victims.

Never mind. Look at a 15 year chart of any stock index in the world and you'll see a massive head and shoulders formation that measure to a point so low it makes no sense. Right now the Dow is finishing the top of that right shoulder. Once it begins to fall, O, have mercy! Weeping, wailing, and gnashing of teeth will follow, without relief.

The Dow in Gold and Dow in Silver have been correcting these last 18 months or so after those metal highs in April 2011 and August 2012. Now they are re-awakening. Since the August 1999 top in Dow/Gold, stocks have lost about 85% of their value against gold, and about the same against silver. Before this metals bull market/stock bear market ends, stocks will lose ANOTHER 85% against metals, more against silver.

Knowing that ought to make y'all pull those IRAS out of stocks faster than you can say, "Call my stock broker!" Still, the sad nature of humanity is to linger too long on the cliff' edge.

Here's a little tip that even many silver and gold dealers don't understand. The most reliable indicator of silver's direction is an extreme in the premium on US 90% silver coins ("Premium" is the amount it sells for over or under its metal value.)

As recently as 4 October 2012 at the last peak, wholesalers were paying spot silver less 25 cents for US 90% and selling at 10 cents an ounce over spot. A month later, with silver about $3 lower, they were offering to buy at 5 cents under spot. By end of November they were paying spot. By the beginning of January they were paying 20c over spot, and today I can get 65 cents over spot. Most dealers are not offering 90% for sale, or offering it only at 4 week delays, even at 100c an ounce over spot.

The high 90% premium is one reason I have been so stubbornly expecting a silver bottom, and why I thought 4 January was a bottom.

Another footnote to this story: t'ain't nothing like as much US 90% silver coin in the world as everybody thinks. It has been melted since the late 1960s, zillions of bags. One day everybody's going to wake up and say, "How come those bags are carrying a 40% premium?" Easy: because they are the most useful form of silver investments, most divisible, and there aren't many left.

CONFISCATION? After I denounced the government gold confiscation myth yesterday, a bewildered subscriber wrote, “Haven't you always been saying the NGM would confiscate gold?” Here’s my reply:

1. I have never in the past 15 years written that "today's NGM want to pull off the same dirty trick" of confiscation.  You must have misinterpreted what I wrote.

2.  Yes, gold offers a safe haven from hyperinflation, but the central banks and governments have spent the last 80 years driving gold out of the system and proclaiming it is not money.  Confiscating it will prove otherwise.

3. The spoils don’t justify the game. People who buy gold or silver by and large do not trust the financial system or the government/Fed. Imagine porcupines in a liverish mood, and you’ll have a good picture how sweetly they would cooperate with confiscation. The loot confiscated won’t repay the NGM’s grief suffered in the confiscating.

4.  The LONG TERM game is for the Insiders to get as much gold possible as cheaply as possible (probably the main purpose of the gold price suppression 1996 - 2005), to run the inflation game as long as possible, and THEN to reverse their field and again base the monetary system on gold.  That will only happen after they have bled the rest of us dry and the whole system has gone hooves up.  That's a long time off.

5. 2013 is not 1934.  Circumstances today, as well as the law, have all changed.

Again, you are more likely to be abducted by aliens from the planet Zambodia tonight than you are to suffer the government confiscating your gold.

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.