Monday, March 10, 2014

The Gold Price is Rallying Climbing $3.30 to $1,341.40

Gold Price Close Today : 1341.40
Change : 3.30 or 0.25%

Silver Price Close Today : 20.879
Change : -0.018 or -0.09%

Gold Silver Ratio Today : 64.246
Change : 0.213 or 0.33%

Silver Gold Ratio Today : 0.01557
Change : -0.000052 or -0.33%

Platinum Price Close Today : 1476.60
Change : -6.40 or -0.43%

Palladium Price Close Today : 776.65
Change : -4.95 or -0.63%

S&P 500 : 1,877.17
Change : 0.87 or 0.05%

Dow In GOLD$ : $253.02
Change : $ (0.10) or -0.04%

Dow in GOLD oz : 12.240
Change : -0.005 or -0.04%

Dow in SILVER oz : 786.37
Change : 2.31 or 0.29%

Dow Industrial : 16,418.68
Change : 34.04 or 0.21%

US Dollar Index : 79.750
Change : 0.010 or 0.01%

A couple of things keep me from raving the silver and GOLD PRICE bullishness. I am bullish already, just not foaming at the mouth. First is the 200 day moving averages, which are still moving down, although very slowly. Those need to turn up. Second is confirmation by climbing over those last two tops, $1,360 and $1,434. So maybe we ought to peck at buying on the way up.

The GOLD PRICE climbed $3.30 to $1,341.40 while silver fell back 1.8 cents to 2087.9. This is merely trading back and forth over the same ground without any progress. Gold will soon meet its 20 DMA ($1,324) and the rising uptrend line about $1,320. It could fall all the way to $1,280 without damaging its rally. The SILVER PRICE has fallen beneath its 200 DMA (2099c today) and bounced off the top boundary of the Nov-Feb trading range. 50 DMA lies not far below at 2038c.

Silver and gold prices are rallying, and most likely the December low made a firm double bottom with June. All we need now is more confirmation.

The weather's too good. Spring fever has taken me and I'd rather be outside in the sun than sitting here thinking about markets.

Worse yet, one of our Jersey cows, Becky, had a calf a few days ago and I've been helping milk the last couple of days. If I milked 100 years I would never get over the miracle of it. Not just the cow giving creamy rich milk by the bucket, not just that unspeakable miracle, but her letting me sit down beside her, stick my head in her flank, grab a teat and milk. Y'all think there's something better, but there ain't.

I've been thinking that we're all like folks living on the slope of a volcano in a hut. We are so used to the rumbling and the smoke and the fire on the mountain that we just discount it all, but one day Vesuvius will erupt. I keep studying the US economy and especially its monetary state, and all I can see is smoke and earthquake and fire and lava flow. We've been living with it so long we've become hardened to it.

The Fed and the government have one job: keep the volcano from blowing off. Keep it burning slowly so nobody moves off the mountain. And here I am fiddling and fuming about whether gold might go up or down $20, when I simply ought to buy before the whole mountain goes up in flame.

Stocks sat down today after a little run on Friday. Dow then rose to an intraday high of 16,505.7, closing in on the December intraday high at $16,588.25 and working on ending the non-confirmation between the Dow and other indices. Today the Dow lost 34.04 (0.21%) to 16,418.68 while the S&P500 backed off 0.87 (0.5%) to 1,877.17. No sign of any change to the uptrend.

Dow in Gold today lost 0.33% for a close at 12.24 oz (G$253.02 gold dollars). I have been expecting a counter trend rally through the downtrend line, correcting the long fall from December. Well, Friday the DiG just walked through the downtrend line and the 20 DMA (12.23 oz), so momentum is up, but listless.

Dow in silver dropped 0.28% to 785.21 oz. Has not yet closed above its downtrend line but is above the 20 DMA (763.35 oz). All this is baffling because silver and gold keep hanging on rather than following through with a correction downward. More of that below.

Think today about copper, industrial metal so the gauge for economic outlook. "Dr. Copper, the metal with a PhD in economics." And the proverb, "Every major stock market top has a copper roof." In the last two days copper has broken down badly, from $3.20 to $3.032 today, a waterfall on high volume. If it breaks $2.98, well, it would fall a long ways.

Copper made its high and entered a correction before silver did in April 2011. No argument, copper is pointing to lower economic activity, a LOT lower if it breaks $3.00.

Then there's the US dollar. It fell out of bed last week and has only modestly recovered. Gained a whole basis point today to end at 79.75. Needs to climb over 80 soon to recapture respect.

More trouble for the dollar: the 10 year treasury yield rose to 2.821% intraday high on Friday. The lynchpin of the Fed's insane strategy is keeping interest rates low. If the market wrenches control of rates out of the Fed's hands, its entire scheme could explode.

Meanwhile among the other lowlife white trash scabby fiat currencies the Euro tried to break out Friday and reached $1.3907. It appears determined to move higher, and should it breach that mark much it will. Yet I am scratching my head: how can European manufacturers stand the euro that high, as it kills their business and the European economy depends far more on exports than the American. Is the Fed passing the ECB some quid pro quo for letting the dollar drop so low, or is its own inherent sorriness dragging it down? A deep question.

Yen is knocked back every time it tries to rally. Now its below its 20 and 50 day moving averages again, and both are below the 200. Cold fall another 10 to 15 cents per Y100. Closed today at 96.85, up 0.01%. Euro fell today 0.4% to $1.3877.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

© 2014, 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.