Tuesday, April 30, 2013

One More Plunge in Gold Prices — Just to Prove the Bottom has Feet

Gold Price Close Today : 1472.20
Change : 4.80 or 0.33%

Silver Price Close Today : 24.144
Change : 0.022 or 0.09%

Gold Silver Ratio Today : 60.976
Change : 0.143 or 0.24%

Silver Gold Ratio Today : 0.01640
Change : -0.000039 or -0.24%

Platinum Price Close Today : 1505.40
Change : -0.20 or -0.01%

Palladium Price Close Today : 696.70
Change : -1.40 or -0.20%

S&P 500 : 1,597.57
Change : 3.96 or 0.25%

Dow In GOLD$ : $208.37
Change : $ 7.50 or 3.73%

Dow in GOLD oz : 10.080
Change : 0.363 or 3.73%

Dow in SILVER oz : 614.64
Change : 0.31 or 0.05%

Dow Industrial : 14,839.80
Change : 21.05 or 0.14%

US Dollar Index : 81.69
Change : -0.445 or -0.54%

The silver and GOLD PRICES are blowing hot and cold out of both sides of their mouth. Gold rose $4.80 today to $1,472.20 while silver rose a measly 2.2 cents to 2414.4c. Gold looks to be knocking on a $1,476 ceiling, while silver appears to have peaked yesterday.

The SILVER PRICE must not sink below 2400c, lest it suffer another cascade. Gold needs to hang on above $1,450. I'm sure the problem with the silver and gold prices (and gold is leading right now) is that the approaching $1,500 mark is wearing at gold like Kryptonite wears on Superman. I still incline to one more plunge, whether to a slightly lower or slightly higher low I don't know, just to prove the bottom has feet. THEN, oh, THEN y'all will see silver and gold begin to rise once more.

Why can't I believe the Masters of the Universe and Nice Government Men when they keep repeating that "every day in every way the economy is getting better and better"? I might jes' be a natural born fool who don't know no better than to doubt his betters, but then again, maybe their horns don't toot in tune.

Take today, bless their tiny bureaucratic hearts! The media is just a bustin' their propaganda buttons over the Case-Shiller Price Index jumping 9.3% year over year. Now I just worked up that graph (I'm a fool, but I can work Excel) and that index looks none too healthy, although the 12 month rate of change is rising. However, the very same day my Masters tell me how good the housing industry is, a local builder tells me (1) home building is as bad as he's ever seen it, (2) it's not getting better, (3) no such thing as building houses on speculation any more, and (4) only the most financially secure people can get mortgages to build now.

Who's a natural born fool to believe? Them known liars on Wall Street and in Washington? Why, they while away their time pulling the wings off flies! Or should I believe a man of proven integrity and truthfulness? Y'all tell me, 'cause I jes' can't figure it out.

Stocks enjoyed a bold day, both closing on their highs. This would be a good place for them to press higher, but a more likely place for them to fail.

S&P500 rose 5.03 (0.25%) to 1,597.57, a new all-time high. Gainsaying its little brother, the Dow didn't reach a new high, but closed at 14,839.80, up 21.05 (0.14%). (Dow's all-time intraday high came 11 April at 14,887.51, high close same day at 14,864.14.). I told y'all a while ago it's too hard for me to parse mania markets, so I will just say, Don't expect this to end well, but in weeping, wailing, and gnashing of teeth.

I don't know. Maybe I misjudged the euro. Maybe it ain't sorry as gully dirt after all -- but don't y'all bet on that. It did break out over its downtrend line today, which I should have foreseen yesterday when it hit that 62 DMA. Truth to tell, I just don't care that much what one scurvy, scrofulous fiat currency or the other does. It's like watching dinosaurs die and betting which one will go extinct first.

Euro rose 0.54% today, a sizeable jump, to close near its $1.3086 high at $1.3170. If the scurvo -- make that euro -- can get past $1.3200, it can run, but that level might stop it cold.

Japanese yen rose 0.34% today to close at 102.65 cents/Y100. It, too, today closed above its downtrend line. I would no more bet on that than I would be fitted for a wooden leg. No telling what those NGM will do. Don't trust 'em.

US DOLLAR INDEX was today's sickest sufferer. Dropped 44.5 basis points (0.57%) to 81.693, below support it had to hold if it intended to rally. Hate to call anything the NGM are steadily manipulating, but if this were a real market, today's weakness and close way below the 50 DMA yesterday would send it dropping like a hand axe off a tree-climbing West Coast lumberjack.

Whoops! Looky there! The Dow and S&P500 are a-making new highs, but the Dow in Silver (613.6 oz today, up 1.38%) and the Dow in gold (10.08 oz today, up 0.37%) ain't. In fact, they are still a-downtrending. Stocks have turned down against gold and silver, a very good, a splendid sign.

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.