Wednesday, February 25, 2015

The Gold Price Rose $4.10 or 0.34 Percent Today to $1,201

25-Feb-15PriceChange% Change
Gold Price, $/oz1,
Silver Price, $/oz16.420.241.50%
Gold/Silver Ratio73.125-0.840-1.14%
Silver/Gold Ratio0.01370.00021.15%
Platinum Price1,172.806.200.53%
Palladium Price807.3018.052.29%
S&P 5002,113.861.820.09%
Dow in GOLD $s313.68-0.81-0.26%
Dow in GOLD oz15.17-0.04-0.26%
Dow in SILVER oz1,109.60-15.64-1.39%
US Dollar Index94.22-0.29-0.31%

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
Silver and GOLD PRICES are confusing me, blowing hot and cold out of both sides of their mouth. Gold rose $4.10 (0.34%) today to $1,201 but silver climbed 24.2 cents (1.5%) to $16.424.

My first bewilderment arises from the GOLD/SILVER RATIO. It made a diamond reversal, and has respected the downtrend line from that reversal. Now today it closes a at new low for the move (73.125), and below the intertwined 20 & 50 DMAs. Normally a falling gold/silver ratio accompanies RISING metals. Why is the ratio calling for higher metals' prices? Anomaly?

Both the Dow in Gold & Dow in Silver are reaching for the top of their Gator Jaws formations. Sure, if stocks rose much higher or if silver & gold plummeted, they could reach that top jaw & shoot right through. However, broadening tops are generally quite reliable & don't behave that way.

After two days puncturing but not closing below the uptrend line from early November, gold spent the whole day above that line. Admittedly, it didn't pull away from that line or close much higher, but it stopped the bleeding. Also possible that gold rallies from here, but can't make it past its 200 day moving average (1,249) or last high ($1,307.80). However it eventually turns out, it appears the next gold move will be up and not down, if gold keeps hanging on by its fingernails tomorrow.

The SILVER PRICE jumped above an internal downtrend line. Not bad. Just above is the 50 DMA at $16.74. Here, too, we have to be careful not to confound a short reaction rally with a longer, genuine rally.

Yesterday I was sour on silver & gold prices, but they dropped to new lows day before yesterday, and fiddled yesterday, but recovered today. Momentum & trend indicators seem to want to turn up, although they haven't yet. I think a little rally is building, lasting or not.

First the investigation, then the cover-up: Zero Hedge reported yesterday that the US "Justice" (their fame begs the quotation marks) Department is investigating ten megabanks for GOLD PRICE rigging.

Janet Yellen spoke to congress yesterday, & generally pushed off into the future's dim mists any raising of interest rates. That didn't work as well for stocks as it usually does, raising the Dow 95 and the S&P500 5.8 Today they went nowhere: Dow climbed up 15.38 (0.08%) to 18,224.05 but the SUP500 backed up 1.82 (0.08%). Whoops! Apple dropped 2.5% today, probably on news they lost $583 million in a lawsuit.
Many stock indices have in recent days broken through resistance points to new highs. That can mean two things: stocks either WILL, or WILL NOT extend their long bull market with another leg. The WILL side says that having broken through resistance of long standing, they must now continue. Right, except that often at the VERY top markets will overthrow their upper resistance in a breakout that fizzles into a fakeout. That's the reason we want to see them pass that resistance by 2 or 3% before they confirm a breakout upside.

The WILL NOT side says, let's see that confirmation, first. Then there will be plenty of time to talk about new legs up.

I don't say a durned thing, 'cause I'm just a nat'ral born durned fool from Tennessee, & not fit to rub my overalled shoulders with them silk Armanis on Wall Street.

Dollar dropped 29 basis points (0.31%) to 94.22, below the 20 DMA but not enough to break it down out of that triangle. That needs a close below 94 and might come tomorrow. Sorry Euro rose 0.14% to $1.1359. Yen can't move much, rose 0.09% to 84.12. Both of 'em waiting on a dollar plunge.

That tide moving out of US government securities has turned the other way and the yield is falling again. WTIC rose 3.8% to $51.03, which makes its dip through the uptrend line look like a fakeout.

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

- Franklin Sanders, The Moneychanger

© 2015, 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.