Friday, January 25, 2013

The Gold Price Lost $13.10 Closing Near the Low at $1,656.40

Gold Price Close Today : 1,656.40
Gold Price Close 18-Jan-13 : 1,686.60
Change : -30.20 or -1.8%

Silver Price Close Today : 31.18
Silver Price Close 18-Jan-13 : 31.90.2
Change : -0.722 or -2.3%

Gold Silver Ratio Today : 53.124
Gold Silver Ratio 18-Jan-13 : 52.868
Change : 0.26 or 0.5%

Silver Gold Ratio : 0.01882
Silver Gold Ratio 18-Jan-13 : 0.01891
Change : -0.00009 or -0.5%

Dow in Gold Dollars : $ 173.11
Dow in Gold Dollars 18-Jan-13 : $ 167.30
Change : $5.81 or 3.5%

Dow in Gold Ounces : 8.374
Dow in Gold Ounces 18-Jan-13 : 8.093
Change : 0.28 or 3.5%

Dow in Silver Ounces : 444.86
Dow in Silver Ounces 18-Jan-13 : 427.86
Change : 17.00 or 4.0%

Dow Industrial : 13,870.75
Dow Industrial 18-Jan-13 : 13,649.70
Change : 221.05 or 1.6%

S&P 500 : 1,500.67
S&P 500 18-Jan-13 : 1,485.98
Change : 14.69 or 1.0%

US Dollar Index : 79.748
US Dollar Index 18-Jan-13 : 80.030
Change : -0.282 or -0.4%

Platinum Price Close Today : 1,693.90
Platinum Price Close 18-Jan-13 : 1,672.10
Change : 21.80 or 1.3%

Palladium Price Close Today : 740.25
Palladium Price Close 18-Jan-13 : 722.00
Change : 18.25 or 2.5%

The GOLD PRICE lost $13.10 today to close near the low at $1,656.40. Silver lost 51.5 cents to 3118c.

The silver and GOLD PRICE are not at a point -- $1,655 and 3100c -- where they must either catch or fall further, to $1,640 and 2975c.

Clearly, jumping over $1,700 will take some work.

Looking at it through the optimist's lens, today's gold retreat did no more than take gold down for a final kiss good-bye to the downtrend line from the high from mid-November. That's $1,656. Final kiss good-bye, I remind y'all, occurs after a market breaks through resistance, peaks, then corrects and touches back to that resistance line before it once again takes off.

I've been through these long soul-harrowing times before. You think metals have begun to take off again, only to disappoint you again. It can last a long time. Why shouldn't silver and gold go lower? The low on 4 January was too complete from a lot of angles. Most likely outcome will see silver and gold trading sideways next week, then attempting that $1,700 mark in a week or two.

Y'all think this is bad because you weren't watching the gold and SILVER PRICE in October and November 2008. Gold dropped 32% from its 2008 peak and silver gave up 105% of its preceding gain. Brutal, but by no means the end of the bull market. From an 880 cent and $704.50 low silver and gold rallied for 3 years. As I keep on telling y'all, the bull is always working to shake off as many riders as possible.

Wise words for today: "Keep about your work. Do not flinch because the lion roars. Do not stop to stone the devil's dogs. Do not fool away your time chasing the devil's rabbits. Do your work."

Again today stocks reached new high closes for the move. Dow added 45.42 (0.33%) to 13,870.75 while the S&P500 moved about the same, up 5.85 (0.39%) to 1,500.67. That close over 1,500 offers big round number support to morale, and never mind that it's only 2/3 of a point over 1,500.

Should you take a ruler and draw a line across the 12,875 Dow high in May 2011, the 13,238 in May 2012, and the October 2013 high at 13,662, you have an upward slope that defines the upper Jaw of Death, the upper boundary of a broadening top. (Lower boundary runs from May 2011 at 12,876 through 12,035 in June 2012.) Against that backdrop, within those Jaws of Death, all the present stock rally is playing out. Keep that in mind. (S&P500 backdrop is about the same.)

It is possible the Dow might punch through that upper jaw and reach for the 14,000 high made in October 2007. Witnessing against that is a VERY overbought RSI (75.69 today when 70 is overbought), more so than it was in 2007. MACD -- market's distance above its moving averages -- isn't quite that bad, but strongly overbought.

Stocks have also traded in a rising wedge since November, and the last three days have taken them above that wedge's point. Generally a rising wedge resolves by dropping. Stocks have also risen 8 days running.

It's also possible that stocks will break here for a correction, then renew their rise into March before their final breakdown, assuming that the next one isn't the big one.

But in the teeth of all the Fed's manipulation and the President's Plunge Protection Team and all the twitching and tweaking they can do, stocks are locked in a primary down trend (bear market), and those who have been seduced into believing that a new bull market is arrived and Dow 36,000 lies just around the corner will be undeceived in dust, sackcloth, ashes, weeping and wailing.

Dow in gold has broken above resistance and has an upward target of about 9.12 oz (G$188.53). Today it stands at 8.39 oz (G$173.44). Dow in silver was trying to break down but last two days has rallied no, gapped, above the 200 DMA and the 20 DMA and penetrated the downtrend line. Target here is about 475 oz, from today's 445.3.

US dollar index has a tee-tiny uptrend working, but today lost 23.7 basis points (0.3%) to 79.748. Euro finally burst through $1.3400 resistance to $1,3460, up 0.64%. Target now becomes $1.3486, the Feb. 2012 high. Yen made ANOTHER new low for the move today at 109.98 (-0.69%). I reckon you could take a sauna in the offices of the Federal Reserve and the ECB today, they are so mad at the Japanese for their jawboning competitive devaluation. Lower the yen falls, more it steams the other central banks. I reckon the proverb is true, there is no honor among theives.

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

- Franklin Sanders, The Moneychanger
10:00am-5:00pm CST, Monday-Friday

© 2013, 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.