Wednesday, August 27, 2014

September is Nearly Always a Supremely Strong Month for Silver and Gold Prices

27-Aug-14PriceChange% Change
Gold Price, $/oz1,281.90-1.90-0.15%
Silver Price, $/oz19.410.020.10%
Gold/Silver Ratio66.060-0.163-0.25%
Silver/Gold Ratio0.01510.00000.25%
Platinum Price1,421.900.300.02%
Palladium Price893.905.200.59%
S&P 5002,
Dow in GOLD $s195.480.540.27%
Dow in GOLD oz9.460.030.27%
Dow in SILVER oz624.680.180.03%
US Dollar Index82.49-0.20-0.24%

Markets are all gearing down before the long US weekend. Labor Day is coming upon which, oddly enough, nobody labors. The quiet settled over silver and GOLD PRICES. Gold traded in a $7.30 range to end $1.90 (0.15%) lower at $1,281.90. Silver gained -- ho-hum -- 1.9 cents (0.1%) to 1940.5 cents.

None of this says a durned thing. The GOLD PRICE punched into but couldn't close above its 200 DMA ($1,284.89). No moxie. The SILVER PRICE bounced up but remains glued to the downtrend line from August 2013 and can't pull away higher, not even to cross the 20 DMA at 1975c.

Now oddly enough there are signs -- and no bigger than a cloud the size of a man's hand on the horizon -- of turning up. First, the RSI had reached "plumb over-sold" and has turned up. The Rate of Change has risen from "abysmal" to "lightening up", and the MACD histogram has waxed smaller and smaller while the MACD fast line is trying hard to curve up.

Most likely nothing much will happen the rest of the week, but September is nearly always a supremely strong month for silver and gold prices.

This is getting sort of funny. S&P500 makes a new high by -- 1/10 of a point. Yes, up 1/10 to 2,000.12. Actually traded sideways to lower most of the day, but began rallying after 3:00 to end barely higher.

Dow Jones Industrial Average didn't outshine the S&P500 much. Rose 15.31 (0.09%) to 17,122.01. This looks like wheel spinning at a top as fewer and fewer buyers participate.

CLARITY, that's what we need, clarity of mind and purpose. We are sprayed daily by media firehoses that force our attention this way and that, but really only a few things are necessary, and only a few things forecast all the rest. Somebody told me once that the best commodity traders didn't read much news, but only paid attention to a few important indicators. Most of us don’t have that clarity of mind.

Mercy, I fall prey to the fog, too. As long as I've studied money and the monetary system, you'd think I'd have learned how to spell "inevitability." But my attention is diverted by the Fed's QE sideshow or a gold and silver correction or a stock market rise on manufactured money or some gaseous guru.

No excuse for me. I understand that the central banking system is a scam, a fraud, a con game that will inevitably fail. I understand that over 50% of American income comes from federal and state and local spending. I recognize American imperial overstretch and remember how many empires have committed suicide the same way. Then I look at a six year economic crisis that won't let go of the economy and an economy that remains comatose, and I know how this will end. I know all the money is borrowed into existence, so the Fed cannot possibly stop inflating, or the whole system deflates and bankruptcies abound. And I have observed that in the last 30 years the frequency and amplitude of economic crises has grown, now inveigling the whole globe. And I remember that the whole system rests on fragile human confidence alone.

Yea, I let my mind run over all those things, and clarity -- sharp, acute, unrelenting, unforgiving, ruthless -- returns. And I remember why I am holding silver and gold.

In the bogus currency markets today the US dollar index fell back 20 basis points to 82.49. I wasn't paying close attention yesterday or I'd have noticed that yesterday's high print was 82.75, which fulfilled my target. Today the US dollar index posted an 82.75 high again and what looks like a key reversal (yes, yes, I know that it doesn't quite match that because it didn't trade higher) with a starkly lower close after higher trading. What I'm poking at is, the US dollar index might have topped today. Even if it intends to rise higher (and it could) to 83.65 or 84.60, it is scheduled for a correction here anyway.

Both the euro and the yen are severely oversold and due at least for a relief rally. Euro closed up 0.2% at $1.3194 while the Yen rose 0.2% to 96.29 cents/Y100.

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.