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Wednesday, March 27, 2013

The Gold Price Reached a High of $1,607.95 Closing up $10.50

Gold Price Close Today : 1606.20
Change : 10.50 or 0.66%

Silver Price Close Today : 28.577
Change : -0.072 or -0.25%

Gold Silver Ratio Today : 56.206
Change : 0.508 or 0.91%

Silver Gold Ratio Today : 0.01779
Change : -0.000162 or -0.90%

Platinum Price Close Today : 1579.80
Change : 13.80 or 0.88%

Palladium Price Close Today : 767.15
Change : 6.90 or 0.91%

S&P 500 : 1,562.85
Change : -0.92 or -0.06%

Dow In GOLD$ : $186.95
Change : $ 7.50 or 4.18%

Dow in GOLD oz : 9.044
Change : 0.363 or 4.18%

Dow in SILVER oz : 508.32
Change : 0.11 or 0.02%

Dow Industrial : 14,526.16
Change : -33.49 or -0.23%

US Dollar Index : 83.22
Change : 0.349 or 0.42%

Yesterday the GOLD PRICE flopped through $1,600 support and closed at $1,595.70, but today it rose back $10.50 to close at $1,606.20. When a market breaks to new low ground for a move, then recovers, it signals strength. However, gold's recovery blew hot and cold out of both sides of its mouth, since it only reached a high of $1,607.95. However, the GOLD PRICE chart shows that it only went down today and kissed its 20 DMA (1,591.67) before it turned around. Somebody was likely waiting there to buy.

Now all this is not cornbread and buttermilk, better than which it doth not get, but it is right promising.

The SILVER PRICE must delight in torturing us. It dipped down early in the day (about 2:00 a.m. NY time), hit a low at 2813.9 (a new low for the move), but then climbed up above the bottom boundary of the longstanding range to close down only 7.2 cents at 2857.7. That whispers that somebody with deep pockets will buy gladly down around 2800c.

Now remember one must prove motive, means, and opportunity to prove a crime. With the banks on Cyprus opening tomorrow and the whole world jittery and starting to run into US dollars, the Nice Government Men around the world tasked with protecting paper money and bankdom by manipulating metals prices have motive, means, and opportunity to hit gold hard. And as always, it's easier to do that by hitting the thinner, smaller silver market first.

But mercy! I don't know sic 'em from come here. Don't listen to me.

Y'all can do me a big favor. I don't do Facebook or other social networking, but I have set up a Facebook page for my new book, At Home in Dogwood Mudhole. Would you Facebookers do me the favor of visiting http://on.fb.me/YfMj09 and then "Like" and "Share" it with you friends? Many thanks from your social-networking- challenged Moneychanger.

Banks re-open in Cyprus tomorrow. Likely 'twill not be blessed with halcyon, heart-warming scenes. Goofs running Europe, including the Germans, have gone a step too far in stealing the bank bailout money from the depositors instead of the taxpayers. They could start a world-wide bank run. Y'all better get some cash out of your bank, if only a little. Long weekend is coming, and no time governments like to throw surprise parties better than on a long holiday weekend. Best defense is to have your preparations already made before they throw the surprise party.

Friend of mine, a third generation commodity trader, loves to intone, "In the end, everything comes back to physicals."

What does he mean? That the entire futures market is pyramided on a little point of physicals, so in the end it’s the availability of physicals that determines the price. Now that's been vitiated in some markets where "cash settlement" (settlement for cash at market value rather than the underlying commodity), but not in the metals, at least, not yet.

And my little tiny natural born fool's brain keeps working on the premium on US 90% silver coin. Today if I went to buy 'em I'd have to pay $1.85 an ounce at wholesale for the privilege of making them my own. Y'all stop and think now: that is the HIGHEST premium since the 2008 panic drove the premium sky-high, and before that since Y2K in 1999.

You can mumble to me all day about "anomalies," but that says to me that US 90% silver coin, which, unlike bars or silver rounds is no longer produced, is in short supply. So somebody tell me why that premium has kept on climbing since last November? Is it merely 90% holders loathe to part with their coin at these low silver prices? Or is it a signal that the futures silver price (the paper price) is being jimmied with?

I don't know. I'm just a fool watching from the sidelines.

Day before yesterday the Dow eked out a new intraday (not closing!) high at 14,563.75. Behold, an eye-catching non-confirmation. The S&P500's 2007 high hit 1,565.15, yet in spite of all the foam and froth in stocks right now, the much-broader-than-the-Dow S&P500 has only reached 1,564.91, day before yesterday. If I owned stocks, that would leave me biting my nails.

Today the Dow dropped 33.49 (0.23%) to 14,526.16. S&P didn't drop as much, only 0.92 (0.06%) to 1,562.85.

Both indices are stuck right in a sidewise range, having stuck the top boundary of a megaphone pattern. This inspireth not a happy outlook. Makes me think of gravity, and how strong it is, like when you're 11 and you swing off the garage roof on a rope, and it breaks. Knocks the breath out of you and you are pretty sure there for an instant that you will die.

Since I wrote yesterday the US dollar index has jumped 35.9 basis points (0.46%) ABOVE 83 resistance to 83.221. Crossing above that 83 resistance and hanging on speaks loudly. Somebody -- a crowd of somebodies?-- is buying dollars? Parse that with the drop in the 10 year treasury yield, and you get confirmation that scared money is dribbling into US dollars (the yield moves opposite to the bond price, so a dropping yield means a rising price).

Euro broke morale today by punching through $1.2800, ahh, well, it actually GAPPED down. Closed down 0.63% at $1.2773. Mmmm - huh! I wouldn’t want to be working at the ECB tonight.

Yen has made a timid bottom and turned into an even more timid uptrend. Closed today practically flat at 105.89 cents/Y100.

US$1=Y94.44=E0.7829=0.034993 oz Ag=0.006225oz Au.

On 27 March 2013 English King Charles II gave away Bombay to the East India Company. Time would fail me to explain the entire scheme, but using Charles II's mistress, Barbara Villiers, the crony capitalists in the East India Company got a law passed enabling them to export silver out of the kingdom. Why? Because silver traded in India at a much higher rate than gold, let's say, 12:1 instead of England's 15:1 (not the exact figures). Thus the patriotic East India Company would take shiploads of English gee-gaws and silver to India, which bought 25% more gold in India than it bought in England. Back in England they would buy more gee-gaws, bank the gold, and load up the boat with more silver bound for India. By 1697 they had so emptied England of silver that Parliament raised the standard for silverware, from 92.5% sterling to the Brittania standard, 95.8% pure. A few years later when Sir Isaac Newton "reformed" the monetary system, he put England on a de facto gold standard because so little silver was left in England.

And y'all thought corruption began with our congress. Where the corporations are, there will the vultures be also.

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

- Franklin Sanders, The Moneychanger
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© 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.