Thursday, May 01, 2014

The Gold Price Closed at $1,283.10 if You Like Bottom Picking, You Can Buy Dips Here

1-May-14PriceChange% Change
Gold Price, $/oz1,283.10-12.50-0.96%
Silver Price, $/oz18.99-0.13-0.68%
Gold/Silver Ratio67.571-0.194-0.29%
Silver/Gold Ratio0.01480.00000.29%
Platinum Price1,426.20-0.40-0.03%
Palladium Price814.301.650.20%
S&P 500-21.975.62-20.37%
Dow in GOLD $s266.783.301.25%
Dow in GOLD oz12.910.161.25%
Dow in SILVER oz872.028.310.96%
US Dollar Index79.570.010.01%

The GOLD PRICE lost $12.50 to close Comex at $1,283.10. Silver gave up 13 cents to end at 1,898.9c.

With today's low at 1868 cents, silver had given up 100% of its gains since end-December. Given silver's volatility, that's not unusual, but under the context -- a 3 year correction -- it implies silver will move lower. This lower low today wipes out last week's dramatic upward reversal.

The SILVER PRICE has not, however, traded below its downtrend line from last April. To be clear, if silver is not bottoming here, it might lose its grip and fall to 1750c. It would have to close above 1950c then 2000c in rapid progression to reverse upward.

This brings up my alternate interpretation, that the silver and GOLD PRICE make one last fast spike down before they finally reverse. I have been working on the "double bottom" interpretation, namely, that silver and gold prices made a double bottom with the June and December 2013 lows, and that those would hold. Should gold fail to hold $1,270, it could easily fall $100. Will it? I don't know. If I could answer questions like that, I'd be sitting on the Riviera sipping expensive wine instead of writing this.

Next few days will tell the tale, and test your mettle. If you like bottom picking, you can buy dips here. If not, give it a couple of days to see how metals sort out.

Don't make a mistake. Even if metals make another spike down, you are watching both silver and gold turn up, and the end of the long correction. The rally that comes next will climb further and faster than anything we have seen so far.

Y'all really have little choice: either trust Mother Janet the Money Fairy, or trust silver and gold.

Complacency rules markets still. Stocks backed off slightly but without significance. Silver and gold are about to make me change my mind about their near-term course. And national fiat currencies are still a disgusting affront to all just men and the ambitions of all honest people.

But one day before too long the complacency will break.

Stock investors still believe in the Money Fairy, Mother Yellen. That is, they apparently believe the stock market is rising for economic reasons rather than merely a rising tide of newly created money. This is what they wish is so, but . . .

Dow Industrials today fell 21.97 (0.13%) to 16,558.87 and the Sandp500 inched back 0.27 (0.01%) to 1,883.68. That leaves both still broken out above their short term downtrend lines so they should head higher.

No sooner did I speak of the bearish rising wedge in the Dow in silver than it broke out upwards. Wedges sometimes break out contrary to usual expectation, normall the opposite direction they point. Today the Dow in Silver hit a new high for the move, higher than the December 2014 peak at 853.15 oz (S$1,103.06 silver dollars). Closed today at 869.55 oz (S$1,124.27), up 0.56%. More upward movement will come.

Dow in gold closed above the downtrend line at 12.84 oz (G$265.43 gold dollars). Implies higher prices still.

US dollar index bounced slightly, up 0.1 basis point to close at 79.57. It appears only to be waiting for some signal to fall to 79 and lower. Euro and Yen were flat today.

On 1 May 1707 was created the United Kingdom of England, Scotland, and Wales. It was part of a CENTRALIZING social trend that began about 1600 with the rise of the corporate nation state (as opposed to kingdoms) and sucked power away from localities and peripheries to the center. That 400 year trend has peaked with the ascendancy of a single world empire, the United States. The rest of our lifetime and for another several hundred years, power will flow AWAY from centers and back to localities.

You can readily see that in the United Kingdom. This fall Scotland will hold a referendum on independence and secession from the UK. Fifty years ago that would have been unthinkable -- treason even. Soviet empire fell apart, Catalonia wants free from Spain, Bavaria differs from Germany, Venice voted to secede from Italy, Normandy's not too happy in France, and it's the same all over the world. People are fed up with meddling, bureaucratic central governments. Oh, the trend change is only at the margins now, but it will move fast, even in the United States.

And not a moment too soon.

Aurum et argentum 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.