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Wednesday, May 22, 2013

Silver and Gold Prices Remain Above Their Monday Lows Gold Needs to Close Above $1,550

Gold Price Close Today : 1367.60
Change : -10.20 or -0.74%

Silver Price Close Today : 22.458
Change : 0.016 or 0.07%

Gold Silver Ratio Today : 60.896
Change : -0.498 or -0.81%

Silver Gold Ratio Today : 0.01642
Change : 0.000133 or 0.82%

Platinum Price Close Today : 1469.20
Change : 10.80 or 0.74%

Palladium Price Close Today : 745.80
Change : 4.05 or 0.55%

S&P 500 : 1,655.35
Change : -13.81 or -0.83%

Dow In GOLD$ : $231.37
Change : $ 0.51 or 0.22%

Dow in GOLD oz : 11.193
Change : 0.024 or 0.22%

Dow in SILVER oz : 681.59
Change : -4.07 or -0.59%

Dow Industrial : 15,307.17
Change : -80.41 or -0.52%

US Dollar Index : 84.32
Change : 0.551 or 0.66%

The GOLD PRICE today lost $10.20 to end at $1,367.60. Silver gained 1.6 cents to end at 2245.8c.

I think analysts are really unimaginative and thickheaded to blame every market move on government manipulation, but durned if today didn't smell like the Fulton Fish Market. Or maybe it was simply the Magic of the Ben. I checked gold early this morning, about 6:30 my time, and it was up over $1,400. About 10:30 it gapped down from $1,385 to $1,381, traded sideways until 2:00 p.m., then gapped from $1,370 to $1,365. Low was $1,357.36. What left my mouth gaping? That jump up this morning was consistent with Monday's reversal. More, Bernanke actually said that he was going to CONTINUE (as in "keep on") inflating the currency.

The SILVER PRICE played out the same steps. Climbed to 2286c early in the day, then began falling off about 11:30, then sagged badly after 2:00 to a low at 2238.7. It ended the day up a nothing 1.6 cents.

Well, step back a little and look at a longer term chart. Silver and gold prices remain above their Monday lows, but we still ought to beware waxing too cocksure about that double bottom. The GOLD PRICE needs to close above $1,550 and silver above 2700 cents, the points where they broke down in April, to confirm a double bottom. Problem is, if you wait for that confirmation to begin buying, you will have completely missed the lows.

I interviewed James Turk of GoldMoney today. He said something very interesting: "I expect gold to finish the year higher, as it did in 2008." I've known him for over 25 years, and, of course, he hasn't always gotten the market right. But he has a clear vision of the future, and if delayed sometimes, it is still sure.

I don't much care whether the government is manipulating prices lower to punish and frighten silver and gold investors, or it's a normal market correction. Makes no difference, because both gold and silver are moving much, much higher. And not even the goofs who run the central banks can stop that.,

Things have gotten so irrational, so senseless, that I feel like I'm trapped in a Salvador Dali painting called "Central Banks" where currencies are melting over tree-limbs and table edges. Nothing adds up.

Today, if you can believe the news reports, a questionable proposition to begin with, as Ben The Bodacious spoke to congress, all the markets swayed first one way, then the other, according as his words indicated he would create more money or less. Lo, friends! This scoots beyond Preposterous, through Absurd, and all the way to Harebrained, yet people whose drivers licenses claim they are "adults" are buying all this.

Buying what? First, the asinine and numberless-times disproved concept that a nation can inflate its way to prosperity (disproved lately by Zimbabwe). Second, that stocks will become more valuable (intrinsically) if Bernanke prints more money. Third, that once he started printing, he could ever withdraw that money or stop, let alone stop quickly, and thus drive down the prices of silver and gold. There are words for this: wacky, daft, deranged, dotty, idiotic, nuts, silly, stupid, and irrational. And loony. I left out loony.

I think the media are complicit with this. Look at the pictures they publish of Bernanke, always looking like the wise and knowing sphinx. You can't kid me -- somewhere they have pictures of him digging in his nose for the Big One, but they never publish that.

Now, to today's markets:

On balance stocks took Bernanke's on-again/off-again testimony as an unfriendly gesture. Dow peeled off 80.41 points ( -0.52%) from yesterday after reaching a new all-time intraday high. Ditto for the S&P500, which shucked 13.81 (0.83%) to close at 1,655.35.

Nor did I overlook that both posted today the first half of a key reversal (trading into new high ground with a lower close). If they close lower tomorrow, stocks will have nailed their coffin lid shut. If.

What about the Dow measured by metals? The Dow in Gold was basically unchanged today, actually a little lower if you measure it Dow close to gold close, 11.19 oz today versus 11.17 yesterday.

Dow in Silver chipped off 4.07 oz to close 681.59 oz. It will drop down through the uptrend line about 675 oz.

Currency markets took Bernanke's Blathering to mean a higher dollar. Let's see, "I'm going to continue inflating the currency" translates to a higher dollar price? Loony. Dollar rose 55.5 basis points (0.71%) climbing back above the 84 mark to 84.319. Uptrend intact. Japanese yen backed off 0.45% to 97.12 cents/Y100. Euro lost 0.43% to $1.2853. Nonetheless, an idea worth pondering is a lower dollar.

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.