Monday, June 10, 2013

Spectacularly Higher Gold Prices Lie Before Us Just Be Patient

Gold Price Close Today : 1386.20
Change : 3.20 or 0.23%

Silver Price Close Today : 21.921
Change : 0.184 or 0.85%

Gold Silver Ratio Today : 63.236
Change : -0.388 or -0.61%

Silver Gold Ratio Today : 0.01581
Change : 0.000096 or 0.61%

Platinum Price Close Today : 1505.70
Change : 4.30 or 0.29%

Palladium Price Close Today : 767.65
Change : 8.20 or 1.08%

S&P 500 : 1,641.13
Change : -2.25 or -0.14%

Dow In GOLD$ : $227.01
Change : $ (0.91) or -0.40%

Dow in GOLD oz : 10.981
Change : -0.044 or -0.40%

Dow in SILVER oz : 694.42
Change : -7.06 or -1.01%

Dow Industrial : 15,222.43
Change : -25.69 or -0.17%

US Dollar Index : 81,663.000
Change : -0.222 or 0.00%

Silver and GOLD PRICES didn't follow through with another large break today, a sign of some strength, but also didn't recover enough to inspire anybody. Gold added $3.20 (0.23%) to $1,386.20. Silver gained 18.4 cents to 2192.1c, up 0.85%.

Trying to gainsay the price action are the sentiment and commitments of traders reports. These are as bullish as they've been in the whole course of this bull market. That argues that a big rally is brewing in silver and gold, but has yet to affect prices, and what's a rally without higher prices? A flat or fall.

The SILVER PRICE made a lower low today (2141c) than Friday's. It has bounced off the downtrend line from the April high, but needs to show way more strength to indicate a turnaround. How about closing above the 20 DMA (now 2251c) for starters?

The gold price bounced the same way, but with even less enthusiasm. 20 DMA here is $1,393.

Friday's break argues silver and GOLD PRICES will go lower. That suggests waiting before we buy. Get this part clear: Gold and silver remain in a bull market. Spectacularly higher prices lie before us. Just be patient. Bottom of this move ought to come before June ends.

I hope y'all know that the central banks have steered your world into historically uncharted waters. These vast inflations, creating enormous new money to bail out economies, are, outside emergencies, simply unheard of. What catches your eye is that the US Fed, where for generations (sorry as it was) adults were in charge, is now run by teenagers who have been given car keys and the keys to Dad's liquor cabinet. They're out to prove that driving the wrong way down the expressway at 95 mph while plastered really is a good idea.

But the inflation does raise those stock market prices.

Speaking of stocks, Friday's Three Little Bears reaction to the unemployment numbers fizzled today. May have been "just right" on Friday, but it was disremembered today. Dow abated 25.69 (0.17%) to 15,222.43. S&P500 regressed 2.25 (0.14%) to 1,641.13.

From today's perspective Friday's rally only succeeded in lifting those indices to their 20 day moving averages and their downtrend lines, cracked the lines barely, but wasn't able to push them on through. In the teeth of all the media jubilating, stocks' short term trend remains down. However, that might change at any time. It's a mania.

Dow in gold dipped 0.4% to 10.981 oz (G$227.01 gold dollars). Downtrend remains intact (lower lows and lower highs).

After making a marginal new high Friday, the Dow in silver fell back 7.06 oz. (1%) to 694 oz. Silver is so volatile -- it loves to fool you by doing things other markets never permit. It made a new high after a long roll-over, so does that mean that it will proceed higher? Might, but don't bet your fillings on it. Just as likely to drop like your car keys down a storm drain.

US dollar index is wallowing like a rusty freighter in high seas, and getting lower all the while. Shucked another 22.2 basis points (0.3%) today to 81.663. Friday and Thursday last week the US dollar touched its 200 DMA. One would expect the dollar to rally a few days after last week's shameful skinning, but if it tumbles through the 200 DMA (81.07) panic will set in. Interest rate on the 10 year US note continues to rise.

Bank of Japan meets tomorrow to decide what new wrecking measures it will take. Maybe that uncertainty accounts for the yen's 1.11% drop today to 101.37. Then again, Friday the yen posted a key reversal by breaking into new high territory but closing the day lower. Today it followed that move down, confirming it. Yen ought to move lower, but I suspect the criminal conspiracy that is international central banking may have put the stop to Japanese exchange rate depreciation.

Dollar's cascade last week goosed the euro sharply, to an intraday high at $1.3306. Friday it backed off, but today picked up 0.36% to $1.3255. The silliness of manipulated exchange rates is easily seen here. European economy and banks are in even worse shape than the US.

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.