• Gold Price Needs to Close above $1,340 to Convince Investors it has Truly Broken out Toward the Heavens

    19-Jul-16 Price Change % Change
    Gold, $/oz 1,331.50 3.10 0.23%
    Silver, $/oz 19.98 -0.07 -0.34%
    Gold/Silver Ratio 66.658 0.384 0.58%
    Silver/Gold Ratio 0.0150 -0.0001 -0.58%
    Platinum 1,094.70 -3.80 -0.35%
    Palladium 656.90 10.35 1.60%
    S&P 500 2,163.78 -3.11 -0.14%
    Dow 18,559.01 25.96 0.14%
    Dow in GOLD $s 288.13 -0.27 -0.09%
    Dow in GOLD oz 13.94 -0.01 -0.09%
    Dow in SILVER oz 929.11 4.49 0.49%
    US Dollar Index 97.11 0.52 0.54%
    ‘Twas a day of resolution, and a day of irresolution. 
    The resolute US dollar index resolved upwards out of that flat-topped rising triangle. And it did so persuasively, levitating 52 basis points (0.54%) to 97.11, well above the triangle’s upper boundary. http://schrts.co/OkJ5UT 
    This rising dollar helps explain gold’s timidity today, but I still observe that gold rose in the teeth of a rising dollar. New game, folks. 
    The euro resolved downside out of the even-sided triangle it has been trapped in. Yes, it needs another close below that line, but no doubt you’ll see it, soon. http://schrts.co/HcRUv0 
    Yen jiggled up 0.06% to 94.22. Jiggled. Stumbling trying to fall through the 50 day moving average. Firmly astride the down escalator. 
    As if they didn’t even believe their rally themselves, stock indices irresolutely gainsaid each other. The Dow rose 25.96 (0.14%) to 18,559.01 while the S&P500 fell 3.11 (01.4%) to 2,163.78. 
    When markets that ought to speak together in harmony contradict each other, confusion abounds. 
    So also silver & gold acted irresolutely. Gold gained $3.10 (0.2%) to $1,331.50 on Comex, but silver turned the other way, losing 6.9¢ (0.3%) to 1997.5¢. 
    Both metals are trading sideways & directionless on their 5 day charts. Was I therefore wrong yesterday when I pointed out the pennant/flags on their charts? 
    Newp. Flags abide there still, and were not violated or negated today. 
    Start with silver, http://schrts.co/BE3yxz 
    Today the low on the pennant’s bottom boundary was 1977¢, & tomorrow will be about 1982¢. Upside cap tomorrow is 2013¢, and Thursday will find silver all the way out in the far nose of the pennant, forcing silver’s hand. A close above 2013¢ breaks out of the pennant, but that needs to take place with drama and rise above 2025¢. 
    Tomorrow the bottom line of gold’s [presumptive] bullish flag is $1,305, the upper line $1,331. In other words, it might fall as low as $1,305 & rise as high as $1,331 tomorrow without violating or breaking out of that flag. Really gold price needs to close above $1,340 to convince investors it has truly broken out toward the heavens. http://schrts.co/Vbp2I8 
    Despite today’s irresolution, there will be no irresolution when they break out. Up or down, it will be an enthusiastic move. Of course, those flags point to upside breakouts. 
    Gold/silver ratio is a nasty fly in that ointment, however. http://schrts.co/kh9gOy After a long, gappy downward skid, it may be turning up. That doesn’t bode well for higher silver & gold prices. 
    So many charts, so many indicators, so many signs — who can choose? 

    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.  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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