• Gold Silver Ratio is not Confirming Lower Prices in Gold and Silver

    3-Sep-14 Price Change % Change
    Gold Price, $/oz 1,268.90 5.20 0.41%
    Silver Price, $/oz 19.11 0.04 0.19%
    Gold/Silver Ratio 66.407 0.144 0.22%
    Silver/Gold Ratio 0.0151 -0.0000 -0.22%
    Platinum Price 1,414.00 -16.30 -1.14%
    Palladium Price 875.35 -26.05 -2.89%
    S&P 500 2,000.72 -1.56 -0.08%
    Dow 17,078.28 10.22 0.06%
    Dow in GOLD $s 278.22 -0.98 -0.35%
    Dow in GOLD oz 13.46 -0.05 -0.35%
    Dow in SILVER oz 893.78 -1.20 -0.13%
    US Dollar Index 82.87 -0.14 -0.17%

    3 Day Gold Price Chart
    30 Day Gold Price Chart
    3 Day Silver Price Chart
    30 Day Silver Price Chart

    Silver and GOLD PRICES bounced today, but without making any meaningful progress. Gold clambered up $5.20 (0.4%) today to end Comex at $1,268.90 Silver rose 3.7 cents (0.2%) to 1910.8c.

    All that can be said is, Well, they haven’t busted down old support levels yet and sunk toward the earth’s core.

    The GOLD PRICE rose away from the lower line of the downtrending range, but not far enough to rise back above the uptrend line from the December low. I read that yesterday saw extra high volume at odd times, which leads to the conclusion the Nice Government Men or their egg-sucking dog lackeys were slamming gold again. But they are vultures, they prey on the sick, so if gold were more robust right here it could shake off that attack. We will see whether gold does or not. If not, it might once again visit $1,180.

    The SILVER PRICE, at 1910.8 cents, doesn’t excite anyone but those who recognize what a bargain it is here. Today’s tiny rise changed nothing. Silver is still sliding down that downtrend line from the August 2013 high. Oddly enough, the MACD is trying to turn up.

    1 Year Gold/Silver Ratio

    Here is one other hint that silver and gold prices are not about to waterfall: the GOLD/SILVER RATIO has stayed roughly flat. Today it closed beneath the 20 DMA, that is, crossed the tripwire of a downturn. All its momentum indicators are also pointing down. Yet normally when silver and gold plunge, silver plunges faster, taking the ratio higher. So the ratio is not confirming lower prices in gold and silver.

    So even though silver and gold look peaked, other indicators show some life.

    Stocks were mixed. Nasdaq and Nasdaq 100 dropped a leetle, S&P500 lost 1.56 (0.08%) to 2,000.72. Dow gained a nothing 10.72 (0.06%) to 17,078.28.

    In fact, the S&P500 posted the first half of a key reversal today by reaching into new high ground but closing lower than yesterday. As always, that needs confirming a second day by a lower close.

    Dow in gold backed off 0.24% to 13.44 oz (G$277.83 gold dollars). Dow in silver rose a tiny 0.04% to 890.00 oz (S$1,150.71 silver dollars, knocking at the June high, 892.99 oz (S$1,154.57).

    US Dollar index fell 14 basis points (0.17%) to 82.87, giving up most of yesterday’s gains. It remains overbought so does today make yesterday a mere fluke, a spike without follow-through? If I could answer that question with certainty I’d be sippin’ wine on the Riviera. I’m going to guess that that overbought burden will bring it down, however.

    Yen rose today 0.28% to 95.42. Chart pattern is a cascading fall with a gap, and island after the gap, and another gap down. That generally paints a completed pattern and reversal, so the yen is set up for a rally, at least to work off some of that overboughtness. Euro rose 0.13% to $1.3151 but still inspires no confidence. Like the yen, the overbought euro is inline for at least a little rally.

    Ten year Treasury Note yield today tried to climb toward its 50 DMA but was slapped back. At hits high it reached 2.457%, but ended the day at 2.41%, down 0.37% from yesterday’s close. All the same, it is trying to climb.

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

    – Franklin Sanders, The Moneychanger

    © 2014, 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.

    Write a comment