Tuesday, September 03, 2013

Silver and Gold Prices Both Higher

Gold Price Close Today : 1412.00
Change : 15.90 or 1.14%

Silver Price Close Today : 24.382
Change : 0.919 or 3.92%

Gold Silver Ratio Today : 57.912
Change : -1.591 or -2.67%

Silver Gold Ratio Today : 0.01727
Change : 0.000462 or 2.75%

Platinum Price Close Today : 1537.30
Change : -17.70 or -1.14%

Palladium Price Close Today : 716.20
Change : -8.30 or -1.15%

S&P 500 : 1,639.77
Change : 6.80 or 0.42%

Dow In GOLD$ : $217.17
Change : $ (2.12) or -0.97%

Dow in GOLD oz : 10.506
Change : -0.103 or -0.97%

Dow in SILVER oz : 608.40
Change : -22.82 or -3.62%

Dow Industrial : 14,833.96
Change : 23.65 or 0.16%

US Dollar Index : 83.328
Change : 0.044 or 0.05%

Over the weekend silver and GOLD PRICES found a bottom near $1,380 and 2325c. Yesterday, a US holiday, was quiet but today they went rampaging. Silver bounced up 91.9 cents (3.9%) to close Comex at 2438.2c. The GOLD PRICE added $15.90 (1.1%) to $1,412.

Media attributed gold's boost to a strike in South African gold mines and safe haven buying spurred by US saber-rattling against Syria. If so, neither of those influences will last, as they seldom do, but the media always finds some excuse to blame any rise or fall on.

Technically, gold dropped down to support at $1,380 (recall how much trouble gold had penetrating that barrier) and SILVER to support at 2300c. Both on Friday had closed below the sharp uptrend lines, both jumped right back up to close slap on that line. Typically corrections follow an A-down, B-up, and C-down pattern, so you would expect this B-up to run out of steam in a day or two. But maybe Syria and South African strikes can keep that up for a few days.

All that aside, I remain persuaded that silver and GOLD PRICES bottomed on 27 June for the last low in the 2011-2013 correction. After this brief correction another strong upleg is coming that should take the gold price to $1,550 and silver price toward 2700c. Then we'll see a correction of this rally up from June.

And all that was happening before Syria or strikes were making headlines. It will still be happening after those disappear from the headlines.

SUMMARY: You are watching a brief and short correction in an upward rally that has about $150 in gold and 260 cents in silver to run. Only closed below $1,320 and 2130c would gainsay that outlook.

Forward! September is a portentous month, since Angel Ferkel -- whoops, make that Merkel -- stands for re-election in Germany. Angela has been the heavy hand opening the tap for bailouts for the PIIGS, so this election offers the German people a chance to reject her policies. If she loses, markets will be roiled.

Remember this: when you build a house of cards, first make sure nobody in the room is hiding a ten horsepower leaf blower.

US stocks seem depressed about Bernard O'Bama's plan to embroil the US in yet another undeclared war. Last five days the Dow has bounced off 14,670 and the S&P500 off 1,627. If either breaks those levels, it will drop hard.

Dow today rose 23.65 (0.16%) to 14,833.96. S&P500 climbed 6.8 (0.42% to 1,639.77. For an idea where this puts them, the Dow's 20 DMA stands at 15,111 and the S&P500's at 1662.91. 50 DMAs at 15,239.61 and 1,661.53. Stocks need to climb above those moving averages to turn momentum skyward.

Dow in metals suffered again today. Dow in Silver fell an eye-bugging 3.62% or 22.82 oz to 608.40 oz. Dow in gold lost nearly 1% and ended at 10.506 oz. Both are trading back and forth across the long term downtrend line, and both might suffer here a sharp but brief upward correction. All the same, the trend has rolled over toward the earth's core.

Just how deep is Ben the Bloviator's trouble in Interest rates? Well, there's a downtrend line stretching back to 2007, and like a hatching egg, bond yields right now are pecking through that shell. Today the 10 year treasury note yield closed at 2.848, up 3.6%. A close above 3% will signal lift off, I believe.

US Dollar index has broken through that internal resistance around 82 and shot up, up, up above its 50 DMA. Upside down head and shoulders bottom targets 83.25 at least. Today rose 0.38% to 82.41.

But woe betide the yen and euro! Yen at last fell through that bottom channel line that had supported it since mid-May, gapping down widely through its 50 DMA (101.36) to close down 1.39% at 100.44 cents per Y100. No reason to expect it will stop before 96.41, the May low, and it might go to 80 cents/Y100 if the Japanese Nice Government Men have their way.

The Euro, remember, gapped down last week, and fell through its 20 and 50 DMAs. Today it touched but breached not its 200 dma ($1.3135). The forkéd double top in August spake not with forkéd tongue. Euro it breaches its 200 DMA, it could fall to $1.2755.

I hope y'all's holiday was pleasant. Please note that next week, from 9 September through 13 September 2013, I will be away vacationing with my family. From 6 September, this Friday, I will not be sending commentaries again until Monday, 16 September.

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.