Friday, September 18, 2015

Gold Price Rose $20.80 or 1.86 Percent Closing at $1,138.10

11-Sep-1518-Sep-15Change% Change
Gold Price, $/oz.1,103.501,138.1034.603.1
Silver Price, $/oz.14.4915.1540.6644.6
Gold/Silver Ratio76.15675.102-1.054-1.4
Silver/gold ratio0.01310.01330.00021.4
Dow in Gold $ (DIG$)307.84297.60-10.24-3.3
Dow in gold ounces14.8914.40-0.50-3.3
Dow in Silver ounces1,134.101,081.20-52.89-4.7
Dow Industrials16,433.0916,384.58-48.51-0.3
US dollar index95.2095.00-0.20-0.2
Platinum Price965.20984.5019.302.0
Palladium Price590.50610.3519.853.4

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
'Twas the best week SILVER and GOLD PRICE have seen in a coon's age, not only in the solid gains, but in what they promise. Today silver popped up 17.9 cents (1.2%) to $15.154 and the gold price $20.80 (1.9%) to $1,135.30

On the monthly chart the GOLD PRICE has piled up two higher months but needs a close above $1,250 to confirm a reversal upwards.

Gold Price
On the daily chart the price of gold has punched through its 50 ($1,118) and 20 ($1,126.69) day moving averages, as well as validating the uptrend line from the July low. Next challenge stands at $1,150, where gold failed 1 September, and beyond that in price and importance, $1,170, where August's rally peaked. Up at $1,181.56 is the 200 day moving average, which gold conceivably could reach next week. I may be a nat'ral born durn fool from Tennessee, but don't laugh at that. You might choke on them chuckles later. Meditate on the chart.

In three days the SILVER PRICE has gained nearly a dollar. It burst through its 20 and 50 DMA's, turning momentum up, then crashed through overhead resistance at 1435c. Today it closed slap on the downtrend line from the April 2013 high. 200 DMA stands above at only $16.05, less than a dollar.

A lot of folks are hanging back, thinking it might not yet be time to buy silver and gold. Me, I think that's a king error. I keep remembering those dark days of fall 2008, when silver tumbled to $8.80 and gold to $705. That was the last time I saw silver in short supply as severe as it is now, with 8 week delivery and US 90% coin at a $5/oz premium. I keep remember that from those lows, within 3 years silver was at $48.50 and gold at $1,900. Waiting didn't do nobody no good in November 2008.

But what do I know -- no mor'n a fool talking.

Stock markets around the world were disappointed by the Fed this week when Our Wise Masters refused to follow their expectations. The blind led the blind right slap into the ditch. The loss for the week was not great, but portends much more and worse to come. US dollar index followed stocks down. Even platinum and palladium joined silver and gold in rising this week. Silver set the bar with a 4.6% climb, but gold lagged not far behind, rising 3.1%.

Dow Jones
Gruesome describes the outlook for stocks, like something out of Beowulf, bodies, blood, and gore. Yesterday stocks pouted only a little at Mama Yellen, today they threw a fit on the floor, kicking and head-beating. Dow dove 290.16 (1.74%) to 16,384.58. S&P500 plunged 32.17 (1.62%) to 1,958.03. Since the May highs, the Dow has given back 1,927.47 or 10.5%, the S&P500 172.79 or 8.1%.

Look at the charts and notice the pennant or flag formations, The rule is, "Flags always fly at half staff." Thus the Dow is targeting 14,600 - 14,000 and the S&P 1,750. Just for the end of this first leg down, which started yesterday and will be completed by October's close.

Listen to me, hear me: sell stocks. They have only begun to fall.

So far the US dollar index is following stocks down. Have to infer that the dollar's rise beginning July a year ago from 80 to 102 was spawned by the Fed's dribbling promises to raise interest rates, and the September FOMC meeting was the drop dead date. Now those disappointed speculators are turning against the dollar and the buck will become a pump -- sucking air. The bullet in the head comes when the US dollar index closes below 93.

Dow in Gold
Today the Dollar index added 32 basis points -- after yesterday's monster 104 bp slide -- and closed at 95.00. Euro backed off yesterday's gains to close $1.1300, down 1.15%. Yen rose 0.44% to 83.67. Both are rallying, but sputteringly.

Dow in Silver
WHOA! Dow in gold bumped it's head through the 200 DMA at 15.03 oz on Tuesday, when the FOMC meeting was yet a distant threat. Today it crashed through the 20 DMA (14.53 oz) and closed down 2.52% at 14.38 oz. All dial needles point down, down.

Since Tuesday last the Dow in Silver has dropped 73.28 troy ounces, from 1154.77 to 1,081.49. Fell 1.97% today alone. This day also too it below the 1,104.78 200 day moving average. Lo, the chart! Broke earthward through the uptrend from April 2013, too.

Gold/Bank Index
I point y'all also to the Gold/Bank Index spread. This measures confidence in the financial system. As the spread drops, confidence in banks is waxing. As it rises, confidence is waning. When the stock market crashed in august the Gold/Banks spread gapped up three days running. Heartening sign for gold. Then the spread fell as stocks rallied, but then the FOMC spake. The spread has gapped up now two days running, a very well-muscled sign for gold. Remember, the spread is a fraction with gold the numerator and banks the denominator. More gold gains against banks, the higher the spread floats. What this spread depicts is that faltering confidence in the monetary and financial system which creates the magic ingredient for a precious metals rally: monetary demand. Chart on the right.

Also it's worth noting, just to put the spike into the deflation hoax, that the inflation markets oil and copper may have turned up. May have.

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.