• Silver and Gold Prices Bottomed in December and Have Begun their Next Rally

    9-Feb-16 Price Change % Change
    Gold Price, $/oz 1,198.70 0.80 0.07%
    Silver Price, $/oz 15.44 0.03 0.18%
    Gold/Silver Ratio 77.616 -0.089 -0.11%
    Silver/Gold Ratio 0.0129 0.0000 0.11%
    Platinum Price 937.70 10.70 1.15%
    Palladium Price 517.80 -1.25 -0.24%
    S&P 500 1,852.21 -1.23 -0.07%
    Dow 16,014.38 -12.67 -0.08%
    Dow in GOLD $s 276.17 -0.40 -0.15%
    Dow in GOLD oz 13.36 -0.02 -0.15%
    Dow in SILVER oz 1,036.93 -2.71 -0.26%
    US Dollar Index 96.07 -0.67 -0.69%

    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 added 80¢  to $1,198.70 while SILVER gained 2.8¢ to $15.444¢. Dead in the water after seven wild up-days.

    So both hover, after a long rise. Does it signal a continuation pause, or exhaustion before a faint? Durned if I know. I’m only a nat’ral born durned fool from Tennessee, not a soothsayer. I can’t make up my mind which it is, because I can look at that advance from the bottom two different ways, and one says “‘Twill go higher” and the other says, “Time for a rest.” If I look at silver, often the slower runner of the two as the race begins, I see that it has not reached [what I assume to be] the neckline yet. Might rise to that before it pauses. Mercy — where would that put gold?

    Anyhow, main chance is at least a pause in the frantic pace of rallying, and probably a little correction. Don’t mistake my meaning: silver and GOLD PRICES bottomed in December and have begun the first moves up of their next rally — a rally that will OUTperform 1999-2011 handily. Further, money flow has shifted from stocks to metals. If you fail to line yourself up with these changes, money will flow away from you for some time to come.

    Y’all remember what a baseball does when you throw it straight up in the air? It rises and rises, then it slows and almost hovers an instant, turns, and falls straight down into your eye — unless you’re smart enough to step out of the way.

    Markets are a lot the same way. When they surge or cascade, then slow and hover, they may be changing directions, depending on how far they’ve just moved.

    Take stocks for instance. Always understanding that we may be watching a market jimmied by the Nice Government Men of the Plunge Protection Team, stocks had some very bad down days lately, but may have exhausted that gravitational momentum for the present, perhaps even to turning ’round for a small rally, even the C-leg of an A-B-C (up, down, up) correction that began off the 20 January lows. Might even rise higher, but will remain a countertrend rally, so don’t let it fool you. Bear market rallies can be stronger than Limburger cheesetoast, but die quickly.

    Japanese Yen

    Dow today was a picture of confusion, tanking on the opening, then back up 140 points by 10, back down toward 15,900 by 11:00, rising back to unchanged, then sluicing down again to 15,882 at 1:20, and rallying from there to 16,133 at 3:00 — only to fall back and close at 16,014.38, down 12.67 or 0.08%. I recount this turmoil in detail only to illustrate the market’s bewildered indecision.

    After like churning, S&P500 ended down 1.23 (0.07%) at 1,852.21.

    US Dollar

    Sometimes a hover or hesitation in a chart means it’s getting ready to extend its run. Euro chart on the left, In the last four days it went sideways the first three, then advanced sharply again today. It was hovering to catch its breath to run further. Rose today 0.92% to $1.1296. Yen looks similar, chart on the right, for the short term at least, the central bankers seem to have agreed to let the US dollar drop. US dollar index plunged another 67 basis points (0.7%) to 96.07. Buck has broken the 96.50 support and is now working on breaking 95.50 support.

    Once again I thank your kind hearts for praying for my dear wife Susan. She is waiting for a stitch in her eyeball to dissolve. It’s causing the pain by rubbing against her eyelid. She is tough, but enough pain can slow anybody down.

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

    – Franklin Sanders, The Moneychanger

    © 2016, 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.

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