Friday, October 31, 2014

On the Comex the Gold Price Dove $27.00 to End at $1,171.10

24-Oct-1431-Oct-14Change% Change
Gold Price, $/oz.1,231.201,171.10-60.10-4.9
Silver Price, $/oz.17.63616.0771.559-8.8
Gold/Silver Ratio69.81272.8433.0314.3
Silver/gold ratio0.01430.0137-0.0006-4.2
Dow in Gold $ (DIG$)282.16306.9724.818.8
Dow in gold ounces13.6514.851.208.8
Dow in Silver ounces952.901,081.70128.8013.5
Dow Industrials16,805.4117,390.52585.113.5
S&P5001,964.582,018.0553.472.7
US dollar index85.7986.971.181.4
Platinum Price1,251.401,236.20-15.20-1.2
Palladium Price780.05791.4511.401.5

3 Day Gold Price Chart
30 Day Gold Price Chart
5 Year Gold Price Chart
3 Day Silver Price Chart
30 Day Silver Price Chart
5 Year Silver Price Chart
The GOLD PRICE monthly chart shows it closing just below the long term uptrend line; silver's right on the uptrend line.

GOLD/SILVER RATIO hit a new high for the move yesterday at 73.095, but it backed off strongly today and ended at 72.843. It's no more than a straw in the wind hinting at a turnaround, but it's about the most we've got.

On Comex the GOLD PRICE dove $27.00 (2.25%) to end at $1,171.10. Silver plunged 1.92% or 31.4 cents to $16.077. The SILVER PRICE low today came about 9:30 a.m. at $15.64. High was $16.51 Gold's low was $1,160.50.

Both the silver and gold prices have re-entered RSI oversold territory, but as we have so often experienced, oversold, like overbought, can get oversolder. We've seen the waterfall days, two of them, so are probably near the end of this for the short term. It has done a lot of damage to the technicals and to morale. We have to reckon with the possibility of gold dropping down to $1,100 and silver to $14.90 - $14.65.

So for a while central banking is wearing her silver slippers and riding high. I hope Janet fills her size 12 up with champagne and enjoys it, because sooner or later all that hot money's coming home to roost. That's when THEY'LL wish they'd a bought a half pint and stayed in the wagon yard.

There's an old time song from 1910 entitled "I wished I'd a bought me a half-pint and stayed in the wagon yard." A country boy laments that he loaded up his year's harvest, a bale of cotton, and drove to town to sell it, but instead of staying with his team in the wagon yard (think "truck stop") he went out on the town and bought a bottle of gin. One by one the city folks helped themselves to his money. He laments,

"Don't monkey with them city ducks, you'll find them slick as lard.

"Just go and get you a half a pint, and stay in the wagon yard."

Mercy! Don't I feel that way now, a-tangling with them clever central bank city ducks! Slick as lard don't half describe it. 'Pears they could get away with knifing their mamas in front of a cop. Latest lunacy poured forth from the Land of the Rising Sun while this mother's son was still sleeping peacefully. Seems the Bank of Japan is going to accelerate its government bond purchases and triple (yup, multiply three times) its purchases of ETFs and real estate investment trusts.

Folks, this morning the Japanese yen gapped down from 91.56 yesterday to 89.62 on open today, a 2.1% drop before you ever pulled your hand out of your pocket to shade your eyes. You can't trade markets like that. And how are markets "free" if folks who can legally create money out of thin air jes' buy and buy and buy?

It's the durnedest old lunatic asylum I ever saw.

But it don't do no good to complain. They got the key to the money pump, and they're gonna pump it dry for their friends. Rest of us just have to sit and suffer, till one of us works up nerve enough to say NO.

On to markets: It was the worst week silver and gold have had since April 2013. Stocks left an "Icicle" behind on the charts, falling straight down and climbing straight back up (yeah, I'm sure there ain't no Nice Government Men fingerprints on that job!). I won't say another word about it, it'll just make me sound like a sourpuss.

Key to this'yer puzzle is the US dollar. The FOMC announcement persuaded that market that the dollar was going to get stronger. Today it hit 87.25 at its high, but settled back only 0.82% up (71 basis points) at 86.97. Indicators point to higher prices, so my double top theory will probably be proven wrong Monday with a close above 87. Keep it in the back of your mind, however, because it ain't as crazy as it sounds. Should the dollar falter, everything changes.

I already told y'all that the yen fell plumb out of bed this morning, gapping way, way below the last low (90.93) and closing at 89.04, down 2.75%, a gargantuan move for a currency. Euro did not so badly crumble. It lost 0.75% to $1.2519, but that's still above its last low at $1.2501. Indicators point to the cellar.

Yields on US government paper left a carrot or icicle on the chart, too, along with stocks. Flight to safety that sent money out of stocks and into the "safety" of US government debt has passed for a while.

After crashing like the Russians were on Wall Street decorating lampposts with stockbrokers, stocks came roaring back on whatever that news was out of the FOMC (durned if I know yet why anybody would pay any mind to them criminals, but I just keep my mouth shut). Dow closed at a new high, 17,390.52, up 195.1 (1.13%). S&P500 made a new high, too, up 23.4 (1.17% to 2,018.05. Nasdaq 100 made a new high as well, as did the Nasdaq 100. Them stocks is flyin' high.

All that business I mentioned about B-waves is still sticking in my head, how they can be so strong they can fool you into thinking a whole new leg up is starting when it's the dying gasp instead. Unless the Fed miscreants can manipulate a perpetual bull market, this ought to be over in a week or so. Stocks are rolling over, believe it or not.

I had to laugh when I looked at monthly charts. Every index looked the same with a break of the uptrend line but a close back above the line. Mighty pretty.

Dow in silver made a new high and moved into very overbought territory (78.56 vs. "overbought" at 70). Moved up 2.89% to 1,075.48 oz (S$1,390.52 silver dollars). Looks to have begun another leg up, but as overbought as it is, surely not.

Dow in Gold rose 3.33% today to 14.82 oz (G$306.36 gold dollars), also a new high for the move and also taking it into overbought land. That reaches the top of an internal trading channel that began early this year, so it ought to react back from that on Monday.

I can't remember where I read it now, but somebody was speculating on the Nice Government Men holding up the stock market to brew better election results for the incumbents. Naww! Perish the thought. They wouldn't do that!

Y'all enjoy your evening!

Aurum et argentum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.

Thursday, October 30, 2014

The Gold Price Lost 2.14 Percent to Close at $1,198.10

30-Oct-14PriceChange% Change
Gold Price, $/oz1,198.10-26.20-2.14%
Silver Price, $/oz16.39-0.83-4.84%
Gold/Silver Ratio73.0952.0142.83%
Silver/Gold Ratio0.0137-0.0004-2.76%
Platinum Price1,246.90-23.10-1.82%
Palladium Price780.35-20.00-2.50%
S&P 5001,982.30-2.75-0.14%
Dow17,195.42221.111.30%
Dow in GOLD $s296.6910.083.52%
Dow in GOLD oz14.350.493.52%
Dow in SILVER oz1,049.0863.576.45%
US Dollar Index86.260.180.21%

3 Day Gold Price Chart
30 Day Gold Price Chart
5 Year Gold Price Chart
3 Day Silver Price Chart
30 Day Silver Price Chart
5 Year Silver Price Chart
Today the GOLD PRICE lost $26.20 (2.14%) to close 1,198.10 on Comex. Silver lost 83.3 cents (4.84%) to close at $16.391.

Face it: either silver and gold prices are making double bottoms, or they will fall a lot further.

The last lows came on 3 October at $16.78 and $1,192.20. This carries all the more meaning since these were the lowest closes in the 3+ year correction. Intraday low came for the GOLD PRICE at $1,183.30 on 6 October (the following Monday; today's low hit $1,195.50. The SILVER PRICE intraday low on 6 October was $16.60 against $16.33 today.

In itself silver's weaker performance says nothing. More volatile than gold, it always falls further on the downside.

Charts don't look quite the same, either. Gold's low today was higher than the early October low, silver's was not. Today's silver close was also lower.

Technically the picture is grim. Silver and gold prices rallied off those early October lows, but without conquering many technical targets. Now they've fallen off, and it would take a lunatic like me to say, this is one of those places that you puke in your wastebasket and buy. Why? Either this is the touchback low that proves the early October bottom, or it is the breakdown that will trim another $100 off of gold and $2.00 off silver.

Oh, I won't pull the deus ex machina of Nice Government Men out of the box and blame it on them, but I do muse in the back of my mind. How would I react if stocks were tanking and an FOMC announcement didn't quite bail 'em out? If I wanted stocks to keep floating, would I want silver or gold levitating? Or would I hit weaker silver as hard as I could and sell a batch of gold, too?

Y'all are gonna think I've gone crazy as a Betsy-bug, but wait till I explain.

First, the FOMC meeting yesterday confused the stock market but enthused the US dollar index. For the life of me I can't gulp down the titles "dovish" and "hawkish" when it comes to the Fed cause th'only word that pops to my mind is "swinish" Still I struggle through to try to understand what all these clowns mean. I think by "dovish" they mean that the central bank criminals favor more inflation, by "hawkish" less.

Rather than trying to figure out the mental transmission by which Fed watchers and markets draw their conclusions, I would rather point out their actions, for buried within those actions are their conclusions.

Stocks sold off. Dollar rose. Whatever the FOMC statement (using that word to describe a Fed utterance is an insult to the English language) said, stock investors took it to mean their gravy train had derailed, and dollar investors thought it meant the dollar would become worth more. The Dow fell 0.18% (31.44 points), the S&P500 slid 0.14%. US dollar index added 83 basis points, a huge 0.74%.

Today, however, stock buyers re-thought (or Nice Government Men re-bought) and the Dow jumped 221.11 (1.3%) to 17,195.42. S&P500 added 12.35 (0.62%, not quite as much enthusiasm there) to close 1,994.65. US dollar Index rose 0.18 to 86.26. Yesterday gold and silver held on, today they took their big hit.

Think about the whole mess around the dollar. The Fed has been pouring into the financial system as much as $85 billion a month, now suddenly all that's vamoosed. But that extra money was sloshing around the system to finance the $50 billion of new yankee government debt every month, as well as push up stocks. Now that the slosh is squeezed down to a drip, whoops, now that the trough is dry, what happens? The yankee government is GONNA get that deficit financed, and that will be sucking slosh away from stocks. Not a pretty picture, Miss Janet.

Technically the dollar index might look strong, especially with a two day breakout above the downtrend line, but step back from that chart. Chart on the right: Look at that rise from 1 July, practically straight up, then a peak in October and decline. Standard correction behavior is an A-Wave down, a B-wave up, then a C-Wave down. Often the B-wave can be stronger than a garlic milkshake, only to fool you and drop dead in a C-wave. The long preceding hyperbolic rise argues the dollar must correct for quite some time -- that is always the outcome of such spectacular rises. So perhaps the dollar is merely putting in a double top.

What makes all this so irksome is that the Nice Government Men manipulate currencies more than any other market, so technical conclusions might be precisely correct, only to be defeated by the NGM's manipulations. Hence I always tremble to say anything about currencies, not being privy to whatever secret deals they have made at the BIS over rubber chicken in their monthly meetings.

But for a moment, till disproved by a higher high in the dollar index, I am willing to work on this theory, that the US dollar index is making a double top that may even reach a leetle higher than the previous 86.87 top.

Today the US dollar index added 18 basis points (0.21%) to 86.26.

Stocks may be on their way to a double top which may include a higher high, or simply correcting on adrenalin. Either way, it mattereth not. Their next big move is rugward, for a long time.

Dow in Gold
Dow in Gold chart on the right: The last two days have taken it above its previous (early October) high at 14.28 oz (G$295.19) to a new high today at 14.34 oz (G$296.43 gold dollars). Here's another place where we either get a double top and a collapse, or go much higher. No way to chocolate-coat it.

Dow in Silver
Dow in silver, on the left, It has reached way above the early October high at 1,009.78 oz (S$1,305.57 silver dollars) to a new high today at 1,045.31 oz (S$1,351.51). This is the same situation as gold's: either it reverses near here or rises much higher.

I spoke about the US dollar index above, but didn't mention the other scrofulous parasitic blood-sucking fiat currencies, the yen and euro. Euro today broke down from an even-sided triangle, so it should drop more. The answer to the US dollar riddle I laid out above will control here. Euro lost 0.15% to close $1.2611. Yen broke its uptrend yesterday, punching through its uptrend line and plummeting hard. Ended down today 0.30% at 91.55.

Aurum et argentum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.

Wednesday, October 29, 2014

The Gold Price Lost $4.90 Today Closing at $1,224.30

29-Oct-14PriceChange% Change
Gold Price, $/oz1,224.30-4.90-0.40%
Silver Price, $/oz17.220.030.20%
Gold/Silver Ratio71.10-0.43-0.60%
Silver/Gold Ratio0.01410.00010.60%

3 Day Gold Price Chart
30 Day Gold Price Chart
5 Year Gold Price Chart
3 Day Silver Price Chart
30 Day Silver Price Chart
5 Year Silver Price Chart
Franklin didn't publish commentary today, if he publishes later it will be available here.

Aurum et argentum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.

Monday, October 27, 2014

The Gold Price Ranged from $1,222.20 to $1,235.50 Ending Up at $1,229.20

28-Oct-14PriceChange% Change
Gold Price, $/oz1,229.200.100.01%
Silver Price, $/oz17.190.070.41%
Gold/Silver Ratio71.527-0.287-0.40%
Silver/Gold Ratio0.01400.00010.40%
Platinum Price1,267.1011.900.95%
Palladium Price792.506.200.79%
S&P 5001,985.0523.421.19%
Dow17,005.75187.811.12%
Dow in GOLD $s285.993.141.11%
Dow in GOLD oz13.830.151.11%
Dow in SILVER oz989.576.930.70%
US Dollar Index85.45-0.15-0.18%

3 Day Gold Price Chart
30 Day Gold Price Chart
5 Year Gold Price Chart
3 Day Silver Price Chart
30 Day Silver Price Chart
5 Year Silver Price Chart
The GOLD PRICE ranged from $1,222.20 to $1,235.50 and for a whole day's trading gained exactly 10 cents to $1,229.20. Silver added seven cents to close Comex at $17.185. Range was $17.40 to $17.06.

Looking at the one day chart, it doesn't look quite so boring. Gold shot up at 10:10, even gapped up, reached $1,235, traded up there about an hour, then was slapped down just as fast as it has risen. The SILVER PRICE behaved the same way. One wonders whether the Nice Government Men are nervous about possible gold and silver reactions to the FOMC tomorrow. If, as I suspect, stocks advance on whatever the goofs announce, silver and GOLD PRICES should take a hit, then turn around Thursday or Friday.

Here's another piece of the puzzle. Gold forward rates have moved into backwardation, signifying a push on for physical metal.

Just be patient. Gravity still operates. Not even the almighty yankee government and the all-knowing Fed can defeat gravity.

Since the long shadow of the Federal Open Market Committee (FOMC) meeting Wednesday hath put all markets but stocks to sleep, let's think on other things.

Stocks' recovery from their October waterfall plunge (down 8.6% from September highs) illustrates behavior you ought to come to expect. Bear markets exhibit sudden, sharp rallies often driven by short covering. They can recover a large percentage of lost territory, but in the end fail because they are only correcting the foregoing fall. Bear market rallies evaporate as fast as they materialize.

Seems to me -- although I never underestimate the clever central bank criminals -- that the Fed has worked its way into a corner with only two ways out. If they really stick with no more quantitative easing, then they risk what they call a "deflationary collapse" and face unemployment rates of 50%. On the other hand the stock market has clearly turned down and needs another dose of Quantitative Easing to ease its levitating. It's pretty late in the game to do that, so observers are liable to punish the dollar (and reward gold and silver) for more QE. Since it's hard to imagine the Fed not "doing SOMETHING," one assumes they will dive in with more QE as soon as the stock market shoe begins to pinch.

Now, it's possible to drag this out, which is the Fed's usual tactic, but basically they face these two choices, either [what they call] "deflation" or hyperinflation. Whenever y'all get confused by the trees, just back off and view the forest from this perspective.

Stocks are demanding perfection in their anticipation of the FOMC announcement, and some of us already suspect that no quasi-government agency is perfect. Today the Dow jumped 187.81 (1.12%) to 17,005.75. S&P500 jumped 23.42 (1.19%) to 1,985.05. That takes both indices above their 50 day moving averages.

Now I suppose it is possible (but I count it unlikely) that stocks might reach up and make one last high for an enormous double top -- those indices, that is, that haven't already done that. Maybe the FOMC has some trick up its atherosclerotic sleeve that might do that, but I don't know what. Rather, I think all this anticipation will end in disappointment that grabs hold of stocks about Thursday.

US dollar index closed today down 15 basis points (0.17%) to 85.45. That's plumb on the line of support, so much lower and it falls over an edge.

Both the euro and the yen are trying to rally and have established if none to convincing uptrends. Yen has fallen back in the last 2 weeks and now is crawling under its 20 DMA like it wants to turn down. Euro is pushing the upper boundary of a little triangle. It gained 0.30% to $1.2737 today while the yen fell 0.33% to 92.46.

FOMC pronouncement will affect all this. If they push any rise in interest rates out further, it would hurt the dollar.

I have to take my wife Susan up to Nashville for some medical tests tomorrow so I won't be publishing a commentary tomorrow. Y'all will have to suffer the FOMC announcement in my silence.

Aurum et argentum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 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.