Wednesday, May 21, 2014

The Gold Price Lost $6.50 Closing at $1,288

21-May-14PriceChange% Change
Gold Price, $/oz1,288.00-6.50-0.50%
Silver Price, $/oz19.31-0.01-0.03%
Gold/Silver Ratio66.712-0.316-0.47%
Silver/Gold Ratio0.01500.00010.47%
Platinum Price1,474.106.000.41%
Palladium Price830.304.600.56%
S&P 5001,888.0315.200.81%
Dow in GOLD $s265.353.871.48%
Dow in GOLD oz12.840.191.48%
Dow in SILVER oz856.328.491.00%
US Dollar Index80.120.030.04%

After a hard day the GOLD PRICE closed $1,288, $6.50 lower. Silver lost six cents to 1930.7c.

The days range was only about $14, from $1,296.3 to $1,282.90. Yes, yes, gold fell but not outside its even-sided triangle, and not below its uptrend line. Yet 'tis sorry form to stay below your 200 DMA ($1,299.21) and 20 DMA ($1,295.40), and leads onlookers to conclude you are weak and spineless. Other onlookers might say, though, "Lo! It broke not beneath the bloviating blatherstorm from the FOMC! Is that not a sign of strength?" Other onlookers say naught, having dozed off waiting for something to happen.

Nor did silver change greatly today. Yea, it fell to its uptrend line. So? So nothing meaningful has yet taken place.

The SILVER PRICE breaking below 1925c (the present uptrend line) or gold below roughly $1,278, lower boundary line of its triangle, would constitute a breakdown. Up above, the GOLD PRICE closing over $1,316 or silver over 2005c (the last high) would mark an upside breakout. Meantime, all else merely spins wheels and digs in the mud.

Meanwhile, we wait.

Do y'all remember how, before you learned the rules, you watched your parents play cards and couldn't figure out what was happening? That's how I feel a lot of the time watching markets react to Federal Open Market Committee (FOMC) minutes. They don't even say as much as an Alan Greenspan speech, they mumble on about the same things, but whatever they say stocks rise. I ain't too bright, but I'm beginning to doubt this game makes sense. Whole point is to keep markets forever on tenterhooks. I miss the adults.

The US dollar index sure liked whatever the FOMC said. After making a double bottom with Monday's 79.90-ish low early in the day, about 5:00 a.m. New York time it began to climb, hitting at one point 80.37. Now on the chart that's a big range, and it jumped clean up to the downtrend line, but at the end of the day it nor more than a little mouse-burp because the dollar index only gained 3 basis points to close at 80.12. But that's kind of a key reversal, a break into new low territory with a higher close, except the cheesy low was at 79.94, same place as Monday's. So we're left with the same mulish dollar, balking. Won't rise, won't fall. MACD however, is positive, and today's fall and recovery probably cleaned out a bunch of shorts, making higher prices possible.

Euro sank another 0.11% to $1.3685. Mercy, if you owned euros your teeth would be aching sure enough. Hath fallen nearly to its 200 DMA ($1.3624). Destined for low places, soon. Yen today hit is 200 DMA (99.09) and crumpled. Fell 0.09% to close at 98.63 cents/Y100. That is only the first try, though, and the yen ought to return and breach that barrier.

After losing 137.55 today the Dow gained 158.75 (0.97%) today and closed at 16,533.06. In other words, it bounced off its 50 DMA (16,407) and up to recent resistance. Closed also barely above its 20 DMA (16,523.32). This gets it NEAR to accomplishing something meaningful, but "near to" only scores when you're playing with hand grenades.

S&P500 won back 15.2 points (0.81%) and closed at 1,888.03. 'Tis above the 20 DMA (1,880) but otherwise only at the threshold of recent resistance. Must climb through that that to count.

A workman should never blame his tools. That's the incompetent's way out, yet these charts have been bouncing back and forth like a tennis ball, forever drawing near some resolution without ever in fact resolving, and I'm stumped. Dow in gold crossed back above its 20 DMA (12.76 oz or G$263.77 gold dollars) and still has not cleanly broken down from its rising flat-topped triangle formation. It ushered out today up 1.46% to 12.84 oz (G$265.43 gold dollars).

Dow in silver has walked through its uptrend lines twice, but today also rose over its 20 DMA (849.92 oz or S$1,098.89 silver dollars) to stop at 854.95 oz (S$1,105.39).

My wife Susan had her pacemaker re-programmed last week and together with some medication seems greatly improved. At least that's what I deduce from waking up early this morning to find my bed empty and Susan downstairs trying to fix an outside screen door. This is more like her. Thank you for your prayers, and please don't stop just yet.

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.