Tuesday, August 27, 2013

Gold Price Surged $27.60 Smashing Resistance to Close at $1,420.60

Gold Price Close Today : 1420.60
Change : 27.00 or 1.94%

Silver Price Close Today : 24.651
Change : 0.641 or 2.67%

Gold Silver Ratio Today : 57.628
Change : -0.414 or -0.71%

Silver Gold Ratio Today : 0.01735
Change : 0.000124 or 0.72%

Platinum Price Close Today : 1531.20
Change : -12.40 or -0.80%

Palladium Price Close Today : 749.15
Change : 3.10 or 0.42%

S&P 500 : 1,630.48
Change : -26.30 or -1.59%

Dow In GOLD$ : $215.01
Change : $ (6.69) or -3.02%

Dow in GOLD oz : 10.401
Change : -0.324 or -3.02%

Dow in SILVER oz : 599.41
Change : -23.10 or -3.71%

Dow Industrial : 14,776.13
Change : -170.33 or -1.14%

US Dollar Index : 81.139
Change : -0.252 or -0.31%

The GOLD PRICE surged $27.60 or 2% to smash clean through all that resistance above $1,400 and close at $1,420.60. It ran clear to the next resistance area, and closed near the high. Silver vaulted 64.1 cents (2.7%) to 2465.1c.

All this is fine and makes us want to celebrate, but it reveals the problem with bull market rallies. They get oversold and can stay oversold for a while, and even as you are watching and know they are overdone, you haven't much of a clue when they will expire. I believe the GOLD PRICE will reach $1,550 at least and the SILVER PRICE 2600c to 2700c, but I wouldn't be surprised if they stopped and fell back at any time.

Point is that most likely (I reserve a small off-chance) they bottomed in June. After the beating both took in April and May, they have a lot of re-building to do. Therefore, be patient. Inoculate yourself against any sudden drops OR sudden rises. Remember H.L. Hunt's about never getting too elated in victory or too downcast in defeat.

But for the nonce I expect silver and gold prices to continue rising, and six months or a year from now buying at these prices will look like investing genius. But now you have to buy with one hand and in the other hold a wastebasket to puke in.

Even a natural born fool from Tennessee knows that life ain't easy.

A reader asked me today if the US regime's threats to make war on Syria are driving up silver and gold prices. Good question. With markets, the readiness is all -- I mean, the internal readiness to rise or fall. When they are ready, any old catalyst will do. Silver and gold prices have already been rising for two months so US saber-rattling has little to do with the rally. However, war scares can give gold a little spurt, but in my thirty-three years experience, such scares NEVER make any permanent alteration in the gold or silver market. They blow out as quickly as they blew in.

By the way, the government's propaganda machine has really kicked into high gear suddenly, which indicates that somebody in the US wants that war. The stupidity of meddling in another nation's affairs and trying to overthrow its government, even a very naughty government, ranks right up there with the stupidity of the German, English, French, Russian, Austrian, and Serbian governments in the summer of 1914. Apparently nobody in authority has caught on: wars kill people.

If (I say, If) the threats toward Syria helped silver and gold prices, they poisoned stocks. Dow plunged 170.33 (1.14%) today to 14,777.13, nearing my 14,600 target. S&P500 plunged worse, down 26.3 (1.59%) to 1,630.48. S&P500 in fact gapped down. My 1,590 target draweth nearer apace.

[Long, loud Rebel Yell!] Yes today WAS the day that the Dow in Gold and Dow in Silver fell once again BELOW their long term (about 14 year) downtrend lines. Dow in gold nose-dove 3.02% to 10.401 oz (G$215.01 gold dollars). Eye is set on the 200 DMA at 9.70 oz.

Dow in silver skidded 3.71% or 23.1 oz to perch at 599.41 oz. 200 DMA is a bare 28 oz. below at 571.75.

Why make such a big deal about the 200 DMA? Think about it. In a market locked in a primary downtrend (bear market), most of its time will be spent BELOW its 200 DMA. Rallies above the 200 DMA are either passing and brief anomalies, or, more portentously, reverse the trend. Which is it? You don't know until it resolves one way or the other. The Dow in Gold and Dow in Silver are both re-affirming their downward trend.

Somebody fed the US dollar index ipecac this morning. It dropped 25.2 basis points (0.32%) to 81.139. Yes, y'all are right, that DOES lie below the intermediate uptrend line, and could point the dollar index toward 79. Not done yet, but it could.

Yen took advantage of something today to gap up and above its 20 DMA (103.2). It jumped up 1.51% to 103.08 cents per Y100. Nuts.

Euro rose only 0.16% to $1.3329, and appears to want to fall through its 20 DMA ($1.3326). Watch out.

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.