Gold Price Close Today : 1,276.40
Change : 8.40 or 0.66%
Silver Price Close Today : 21.31
Change : 0.10 or 0.45%
Gold Silver Ratio Today : 59.897
Change : 0.128 or 0.21%
Silver Gold Ratio Today : 0.0167
Change : -0.00000 or -0.21%
Platinum Price Close Today : 1,380.60
Change : 3.00 or 0.22%
Palladium Price Close Today : 714.25
Change : 5.45 or 0.77%
S&P 500 : 1,710.14
Change : 6.94 or 0.41%
Dow In GOLD$ : $247.81
Change : $ -0.60 or -0.24%
Dow in GOLD oz : 11.99
Change : -0.03 or -0.24%
Dow in SILVER oz : 718.03
Change : -0.19 or -0.03%
Dow Industrial : 15,301.26
Change : 64.15 or 0.42%
US Dollar Index : 80.26
Change : -0.04 or -0.05%
I'm going to say something that might surprise y'all: silver & GOLD PRICES did NOT break down last week. Yes, yes, I know they tumbled on Wednesday & Friday, but they did not "break down." By that I mean "break down through any significant line in the sand or change direction (first you have to HAVE direction to change direction). Look, I'll show y'all what I mean.
Today's gold price closed at $1,276.40, up $8.40, while silver rose 9.5 cents to 2131c.
The gold price remains in an upside-down head and shoulders building a right shoulder. Last weeks lows did NOT close below the support line connecting the shoulders' tops. More, that right shoulder has built a bullish falling wedge, which rouses expectations of a breakout toward the sun.
The SILVER PRICE hath done likewise. That top of the shoulders line caught silver, too, and it also has built a falling wedge.
Yet I will climb only so far out on this limb. If the gold price cannot hold above $1,272 at the close or silver cannot remain above 2090c, they'll take one more tumble down toward the June lows, which were 1817 & $1,179.40.
That means that if you buy here and they drop further, you'll look foolish If you buy here & silver and GOLD PRICES rocket upward, you'll have bragging rights to your brother-in-law.
I repeat, lest y'all missed my NGM comments above, if I were the NGM, I would be steady suppressing silver & gold while this debt-ceiling farce plays out. & I remind y'all again that whichever way this silly negotiation flops, it will still be a flop because nothing is being done to address the real problem, that the government debt has grown too big ever to pay off. Therefore, the government will most surely default, either by outright default, i.e., repudiating the bonds, or by severe inflation. I can't say WHEN it will happen, only that it WILL.Durn! Y'all let the market go to pot while I was gone!
Last Wednesday 10 October everything turned, stocks up & metals down. Dollar turned up then, too, but hasn't been able to hang on to the gains. Metals have not resolved their uncertainty, but stocks have. US dollar's hanging on by a gnat's ear.
Dow fell plumb to its 200 DMA & that bottom support line at 14,719.43 (intraday) before it turned up. Since has rallied plumb straight up, gained 323 points last Thursday alone, & busted through its 50 and 20 DMAs (15,180 & 15,230).
S&P500 didn't drop as far at the Dow, but hit an uptrend line from its June & August lows, pierced it to 1,646.47 (intraday), then turned slap around & headed up. It also has closed through its 50 & 20 DMAs (1,678 & 1,694).
So stocks are just a rallying away, but since I am a natural born fool from Tennessee, I keep asking, "Why?" I could see 'em rallying like mad on news of a debt ceiling deal, but why BEFORE a deal? If they're rallying without news, what happens when the news appears & they've already burned up all their buying power?
Logical target for this move is to the top channel line, call it 15,800 & 1,735. Of course, that's not guaranteed by any means. Both the S&P500 & the Dow have painted out head & shoulders top formations since April. For both, the neckline was the point where they turned around last week. If that H&S is ruling action, then I wouldn't expect this present rally to reach much further. But I expect this is the last hurrah, so they might even throw over the top of the channel. Internal measures like market breadth & margin debt make this stock market look like Grandpa on a walker & carrying an oxygen bottle.
As you would expect given last week's performance, the Dow in Gold & the Dow in Silver have risen. Both stand above their 50 & 20 day moving averages, so momentum for now lies skyward. Neither has yet reached the June highs at 12.514 oz or 816.77 oz. Today the Dow in gold closed at 11.988 oz (G$247.81 gold dollars), down 0.24% on the day, while the Dow in Silver ended at 718.03 oz, down a nothing 0.03% today.
Downtrends from June highs remain unbroken, although both indicators are in a short term uptrend.
I recall vividly that after August 1999 when stocks peaked against gold, i.e., the Dow in Gold peaked, how anxiously I watched that chart day after day. It fell into October, then rose into January, but never could reach that August peak. Then it went sideways for the rest of twelve months. Sometimes the turn ain't obvious, & you have to bite nails a while to see what turns out.
Until the US dollar index climbs above 81, we've got nothing to talk about. It did trade up through its 20 DMA (now 80.43) last week, but fell back under it today, trading now at 80.259. The dollar has no net below 79.50 but 73. Just keep remembering that.
The euro wrapped up the day at $1.3564, up 0.17%, but even with a week to work, it hasn't made any progress & is actually lower than it was the week before I left -- notwithstanding its breakout above its top channel line that week. When a market breaks out & ought to move higher but doesn't, it points to a dearth of supporters & all the weakness that implies.
Yen also last week lost all the previous weeks gains. Today it shuttered at 101.37, down 0.1%, or, in plain English, no place.
Now if I were the Nice Government Men with a whole economy & all sorts of markets to manipulate, what would I do? Why, I'd have worked my government fingers to the bone, dialing up my yellow running dogs who do my bidding in markets & working their bones to death. I'd have kept that dollar up, the euro & the yen down, I'd have bought stocks like my government pension depended on it, and I would have slapped silver & gold silly every chance I got.
Wow, here's something odd. That's just what happened. Shucks, just a coincidence.
Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.
- Franklin Sanders, The Moneychanger
© 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 or 18 ounces of silver. or 18 ounces of silver. US $ and 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.