Wednesday, February 11, 2015

The Gold Price Slid $12.60 Closing at $1,219

11-Feb-15PriceChange% Change
Gold Price, $/oz1,219.00-12.60-1.02%
Silver Price, $/oz16.75-0.11-0.66%
Gold/Silver Ratio72.798-0.264-0.36%
Silver/Gold Ratio0.01370.00000.36%
Platinum Price1,196.90-11.70-0.97%
Palladium Price766.850.850.11%
S&P 5002,068.53-0.06-0.00%
Dow in GOLD $s302.912.991.00%
Dow in GOLD oz14.650.141.00%
Dow in SILVER oz1,066.716.690.63%
US Dollar Index95.180.360.38%

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 slid $12.60 (1.02%) to a Comex close at $1,219. I'll have something intriguing to say about that in a second. Silver gave up only 11.2 cents (0.66%) to $16.745.

The GOLD PRICE fall took it through the neckline, today about $1,226.50. Doesn't amount to much on a chart. However, gold did two things that make this price a buy. First, it poked into its bottom channel line of the downtrend from the 22 January high. Right favorable place to buy some. Second, it punched into the bottom Bollinger Band ($1,218.39) and closed pennies above it.

The SILVER PRICE closed right near its 50 DMA ($16.76) & remains in that bullish falling wedge. Looking at the Bollinger Bands two standard deviations on either side of the 20 DMA, silver could fall to 1637c tomorrow before it hit that lower line. What difference does that make? Usually a market stays within those Bollinger bands, and when it punctures the bottom line it's usually a pretty good buy signal (sell signal when it punctures the top). I believe I would buy around there, even if it traded a day or three on the low side of the line. It often does that before it reverses, but without clean falling off the chart -- just a few points below. Remains a little below the neckline, but not enough to give me heartburn.

Gold Price
How trustworthy is that buy signal? Well, looking at a six month chart, on the right, buying at the bottom BB would have killed you in August & September, when gold slid down that line like a waterslide. But it only pierced it on the day before and the day of the ultimate low, then rose to the top line for a $70 climb. In November gold saw three BB punctures. The last marked the early November low at $1130.40 from which it rose to $1,239. At end-November gold again touched its lower BB, and rallied from $1,167.30 to $1,307.80. So I reckon it's either a VERY good buy signal, or VERY bad.

What often happens is that gold punctures the BB the first day, trades lower the second or third day, then closes higher. Buying that reversal day is a more reliable signal.

But what do I know? I'm jes' a nat'ral born durned fool from Tennessee, looking at that breath-stealing orange sunset & heartsick for spring. I won't even mind the flies, I want to hear those spring peepers so bad.

UNCOMFORTABLE FACTS: In the last six years central banks have created $11 trillion dollars. That is incomprehensible.

The Baltic Dry Index, which measures sea freight activity, has hit an all-time low since it was introduced in 1986. Freight rates to ship dry bulk goods have collapsed, which implies that the economic outlook for the world and especially China is almost as bright as the future of a cricket at a chicken convention.

With the Ukraine peace talks beginning & the Greek pot boiling, stocks felt not chipper today. Indices were mixed with the Dow, S&P500, & Russell 2000 down slightly and the Nasdaq and Nasdaq-100 up slightly.

Dow Industrials lost 6.62 (0.04%) to 17,862.14. S&P500 barely moved, losing 0.06 point to 2,068.53. That says almost nothing, given the political threats & distractions. Thanks to lower silver & gold prices, the Dow in metals rose. Dow in Gold rose 1.09% to G$302.84 gold dollars (14.65 troy ounce). Dow in Silver twitched up 0.82% to S$1,377.87 silver dollars (1,065.7 troy oz.). Both bear watching, as they are above both the 20 & 50 DMA, but the 50 DMA stands higher than the 20.

Somebody made my stomach flip over twice today by noticing that the US dollar index hasn't been this high since the 2008 financial crisis.

There's an uptrend line from mid-December that the US dollar index dropped through on 3 February when it fell out of that little triangle. Stayed dancing on that line for 6 days, not strong or weak. Still traded across it today, but closed above, and poked its poll through the downtrend. What happens if the Europeans strike a deal with the Greeks tomorrow? Euro backed up 0.17% to $1.1297, nothing. Yen has started itself another little old downtrend -- tripped and fell 0.68% to 83.13.

US 10 year treasury not yield hit 2%, then fell back to 1.988%, ending its rally from 3 February from 1.673%. With European government bonds yielding negative interest rates, it makes little sense that US government note prices with a positive yield should be falling (yield rising). Another mystery.

West Texas Intermediate Crude diminished 4.16% to $48.84/barrel. It has a little rally working.

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.