Thursday, May 22, 2014

The Gold Price Gained $6.90 Closing at $1,294.90

22-May-14PriceChange% Change
Gold Price, $/oz1,294.906.900.54%
Silver Price, $/oz19.490.180.95%
Gold/Silver Ratio66.439-0.272-0.41%
Silver/Gold Ratio0.01510.00010.41%
Platinum Price1,495.5013.200.89%
Palladium Price836.306.000.72%
S&P 5001,892.494.460.24%
Dow in GOLD $s264.09-1.25-0.47%
Dow in GOLD oz12.78-0.06-0.47%
Dow in SILVER oz848.80-7.53-0.88%
US Dollar Index80.290.170.21%

I looked at the GOLD PRICE early this morning and it stood at $1,304. Time I got to the office it was below $1,300, and closed the day at $1,294.90, within $1.60 of the last six days' closes, save yesterday.

Friends, let us assume for a moment that this is a natural phenomenon. If so, it means that gangs of sellers lurk around $1,305, while mobs of buyers lurk around $1,290, but the crowds are so evenly matched that they can't push the gold price around more than a couple of dimes a day. Meanwhile that even-sided triangle becomes narrower and narrower as the days pass, forcing some resolution soon.

The SILVER PRICE traded much like the gold price today, with a spike up toward midday, then erosion. Silver closed Comex at 1949, up 18.3 cents and above its 20 DMA (1944c), if that means anything in a market this directionless. Silver reached 1983c at today's high, but in the end closed only that piddling eighteen cents above yesterday.

Clearly one hurdle for silver and GOLD PRICES is that stocks and the last five weeks' sideways trading have drained away interest. People don't buy flat markets.

Be patient, be calm, just wait. Steady, steady!

Well, I never heard tell of such! In the last six trading days, save yesterday , gold closed within a $1.60 range. Yesterday's close was only $5.30 lower that that range. Yep, you all are witnessing a RARE freak o'Nature.

Not that stocks were too peppy today either. Dow traded in a lazy 76 point range. All the hot gas from the FOMC ("Feds Organized for Monetary Crimes") that inflated stocks yesterday just drifted off to the gas-o-sphere up above the ozone layer. Dow gained 10.02 (0.06%) to 16,543,08 (yawn) while the S&P500 inched up 4.46 (0.24%) to 1,892.49. That parked the Dow a few points above its 20 DMA (16,525), piddling, yet above.

As Yogi Berra said, "It's like déjà vu all over again." I've seen this before, markets struggling, reaching higher but seeming out of strength. It doesn't forecast vastly higher prices, but a top. But shucks! I'm such a hick from Tennessee, what do I know? I ain't near as smart as them hicks from Boston and New York who're running the Fed. Why, they're smart enough to keep printing money and keep the stock market rising forever. I know it's so, cause they told me.

Any way I jigger the uptrend line, the Dow in Gold (I just report what I see) has walked through the uptrend line. Yesterday it rose, and above its 20 DMA, bit only to touch that downtrend line. Today it eased off again, down 0.17% to 12.77 oz (G$263.98 gold dollars). It's moving sideways but tugging at breaking down.

Dow in silver hath behaved in like manner. Today it again closed beneath the 20 DMA (850.27 oz) and lost 0.58% to 847.49 oz (S$1,095.74). It's literally oscillating around that 20 DMA, but the indicators are all pulling it lower.

US dollar index did in fact rise today 17 basis points to end at 80.29. That bumps plumb up against the downtrend line, so maybe it will reach escape velocity tomorrow. Euro lost another 0.24% to end at $1.3654. Yen backed off 0.31% to 98.30, so it looks like our masters are re-aligning exchange rates.

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.