Gold Price Keeps Hitting the Wall at $945 and Skidding to a Stop About $925

Gold Price Close Today : 930.70
Gold Price Close 26th June: 940.70
Change: -10.00 or -1.1%

Silver Price Close Today : 13.394
Silver Price Close 26th June: 14.128
Change: -73.40 cents or -5.2%

Gold Silver Ratio: 69.49
Gold Silver Ratio 26th June: 66.58
Change: 2.90 or 4.4%

Dow Industrial: 8,280.74
Dow Industrial 26th June: 8,438.39
Change: -157.650 or -1.9%

US Dollar Index: 80.284
US Dollar Index 26th June: 79.828
Change: 0.456 or 0.6%

Remember that a long holiday weekend, such as the one we're facing, takes people out of the market. They close out positions before they leave for the weekend, and put those positions back on when they return on Monday. Anyway, next week is dangerous for currencies and metals, because of the Gang of 8 meeting in Italy.



Look at the 30 day gold price chart. The Gold Price keeps hitting the wall at $945 and skidding to a stop about $925. In other words, its range bound between $945 and $925. Sooner or later it will break out, one way or the other. Either way, it will make a quick, substantial move when it does break out, to $900 or to $1,000. Today it dropped $10.30 to close at US$930.70 on Comex.





The Silver Price must be somewhere near a bottom. The gold silver ratio has moved to a shocking 69.5. How much higher can it go? This looks like a good spot to swap gold for silver. Other indicators show the ratio is about to peak, although silver may drop further. Still, I'm guessing it won't drop below $13.00 - assuming gold doesn't drop below $900.

One other tiny item in silver's favour: the premium on US 90% silver coin is creeping up. That says holders are unwilling to part with their silver at these silver prices, usually a sign of a bottom, but not a terribly timely one always.

Gold and silver are in a long term bull market, so buy the dips, buy the dips!

OW! Stocks lost a whopping 223 Dow points to close at 8,280.74. S&P500 dropped 26.9 and wound up at 896.42. As I said yesterday, the Dow will see 8,200 before it sees 8,600. In fact, it may see 7,800 before it sees 8,600.

In spite of a 60 basis point rise today, the US DOLLAR INDEX remains in a downtrend. It must close above 80.50 to break out of that downtrend. Personally, I think it's time for another re-design of American currency. Besides, those old dead presidents don't swing any weight any more, so to re-align pictures on the dollar with current political realities, I think we ought to put pictures of people on the dollar who really run things. I suggest the new bills feature pictures of the past presidents of Goldman Sachs, and we print a new denomination, the $3 bill, with Little Timmy Geithner's picture.

We will be closed tomorrow for the Fourth of July holiday. Next week, 6 July -8 July, I will be traveling with my son to New Hampshire to search for a new Scotch Highland bull.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

Gold Price Appears to Have Bottomed Unless it Closes Below 928

Gold Price Close Today : 941.00
Change: 13.90 or 1.5%

Silver Price Close Today : 13.740
Change: 16.6 cents or 1.2%

Gold Silver Ratio: 68.49
Change: 0.186 or 0.3%

Dow Industrial: 8,504.06
Change: 57.06 or 0.7%

US Dollar Index: 79.65
Change: -0.52 or -0.6%

Whoa! This volatile back and forth with the US Dollar and gold and silver prices is wearing me out. Before I delve into short term events, though, lift up your eyes unto the horizon. From 31 December 2008 through yesterday, 30 June 2009, the Dow was down 8.6%, the S&P500 up 1.8%, and oil rose 58%. Gold rose 5% and silver rose 20.4%, while the US Dollar index lost 3%.

The US DOLLAR INDEX was battered again, falling 51.5 basis points today to land at 79.646. Downtrend is in effect, and a close above 81.50 is necessary to change that outlook.

STOCKS are paralyzed, with the Dow up today a massive 57 points to 8,504. S&P500 rose 4 to 923.33. Nearer the Dow gets to 8,600, the scarer it gets. Stocks are a lost cause.

SILVER and GOLD PRICES completely confused me today. Instead of following through on the downside, both rose strongly. The gold price led with a $13.90 rise to US$941.00, very strong but not quite clean through the resistance area. The silver price rose 16.6 cents to 13.74. Without contrary evidence, gold appears to have bottomed. Unless the gold price closes below 928, that has to be the operating theory. Yet the silver price needs to confirm this move by climbing above 14.06, then 14.50.

At this point, there is no way I would be short silver or gold. In fact, I am still buying. The stormiest cloud on the horizon is the G-8 meeting in Italy July 8 - 10. No telling what trick that bunch of crooks will pull to drive down silver and gold prices and bail out the banks. Be forearmed for anything, knowing that whatever trick they pull, it cannot for long suppress the metals.

I heard that Bernie Madoff got 150 years in the slammer! Preposterous. As my friend Al Thomas asked, what about the really evil frauds who run Social Security, the biggest Ponzi scheme of all time? How come they're not in jail?

And on the radio this morning I heard that California is verging on bankruptcy, and is going to have to start handing out IOUs to welfare recipients. Hmmm. Let me see if I understand. California gives money to people on welfare because they don't have any money, but now California doesn't have any money, either, so they're going to give people on welfare IOUs? What good is that going to do? Somebody help me before I hurt myself laughing.

Today is Canada Day. Congratulations, Canadians.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

Time is Running out for Lower Gold and Silver Prices

Gold Price Close Today : 927.10
Change: -13.30 or -1.5%

Silver Price Close Today : 13.574
Change: -37.3 cents or -2.7%

Gold Silver Ratio: 68.30
Change: 2.780 or 4.2%

Dow Industrial: 8,447.00
Change: 82.38 or 1.0%

US Dollar Index: 80.18
Change: 0.27 or 0.3%

The US DOLLAR, today's little rise by 27 basis points to 80.178 notwithstanding, has rolled over to the downside, and must now close above 80.75 to turn up. Maybe it will tomorrow, but probably without much enthusiasm.

STOCKS didn't get close enough to smell Dow 8,600 before they turned and fled. Now the Dow stands under its 200 day moving average (8,464.92 today), which in a bear market usually signals a downturn. The Dow should see 8,200 before it sees 8,600.

The SILVER PRICE slipped below its 50 DMA (14.06 cents) today to close on Comex at 13.574, down 37.3 cents. If the silver price cannot defend the line around 13.50 tomorrow, then 'twill drop to 13.00. If the silver price is ever going to drop further it will happen tomorrow. If it holds on here, well, my, that will be strong indeed.

The GOLD PRICE also dipped below its 50 DMA (930.35) and closed on Comex at US$927.10, down 13.30. Several different plots might unroll: (1) The gold price might stop right here, or (2) the gold price might return to its 918.00 previous low and make a double bottom there, or (3) the gold price could drop through 918 to 900 or lower.

If all this sounds bearish coming from my lips, remember that time is running out for lower gold and silver prices. Besides, I hope they do go down and give all of y'all one last chance to buy silver and gold on the cheap, before gold blows through US$1,000 next fall, holding silver's hand.

Tuesday is supposed to be my day off, but I worked bees today with my son, Wright. I'll never get used to opening up a hive of bees while they calmly go about their business. Well, those sweet yellow Italian bees do that. Those black Caucasian bees will eat you alive, and sting you through a bee suit. Is the honey worth the trouble? Are you kidding? Just one single time taste sourwood honey right out of the hive, and you'll know.


Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

Fall Will be a Nightmare for the US Dollar, and High Cotton for Silver and Gold

Gold Price Close Today : 940.40
Change: -0.30 or -0.0%

Silver Price Close Today : 13.947
Change: -18 cents or -1.3%

Gold Silver Ratio: 67.43
Change: 0.838 or 1.3%

Dow Industrial: 8,529.38
Change: 90.99 or 1.1%

US Dollar Index: 79.90
Change: -0.04 or -0.1%

Most markets went sideways today, numbed by traders cleaning their positions before the 4 July holiday.

Both silver and gold prices closed down today on Comex. The gold price dropped 30 cents to 940.40 while the silver price closed down 18 cents at 13.947. While the gold price is holding on at the high end of its trading range, lower closes by both, even though gold's loss was only 30 cents, just doesn't look good. Then again, the week of July 4th is not the time to expect any colossal moves. Somnolence is more likely.

Keep on buying silver and gold on every dip. July brings a possible bankruptcy (practical if not declared) to California, which won't exactly cheer bond markets. Fall will be a nightmare for the US dollar, and high cotton for silver and gold.

The US DOLLAR INDEX barely moved today, down 4 basis points at 79.899. Standing under 80 looks weak.

STOCKS rose 90.99 today to close at 8529.38, a little above the 200 DMA (8,479.80). Any rise will probably hit the brick wall at 8,600.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

The Gold Price is About to Move Higher, and Drag the Silver Price with it

Gold Price Close Today : 940.70
Gold Price Close 19th of June: 935.6
Change: 5.10 or 0.5%

Silver Price Close Today : 14.128
Silver Price Close 19th of June: 14.189
Change: -6.10 cents or -0.4%

Gold Silver Ratio: 66.58
Gold Silver Ratio 19th of June: 65.94
Change: 0.65 or 1.0%

Dow Industrial: 8,438.39
Dow Industrial 19th of June: 8,536.03
Change: -97.640 or -1.1%

US Dollar Index: 79.83
US Dollar Index 19th of June: 80.268
Change: -0.440 or -0.5%

The chart above brightly illustrates why you ought to check WEEKLY charts as well as daily. Think about all the back-and-forth, the tug-and-pull, the blowing and puffing this week -- for what? After all is said and done, the gold price stands five bucks higher, the silver price has fallen a silly six cents, the dollar has fizzled, and stocks have fallen 100 points. In other words, nothing much happened, or else it turned out dead contrary to what you expected during the week.

Since the dollar hit that high on 15 June at 81.085,it has established a firm DOWN trend. Today the dollar ended up at 79.828, down 44 more basis points. If it falls below 79.60 on Monday, then the sharks will smell the blood in the water and the dollar will drop another 100, maybe 150 basis points. Also, I hope the last two weeks' trading has demonstrated to y'all that the idea that gold is tied to the dollar is hogwash. Gold's moves have not been proportional to the dollars, and some days they move the same direction. The Dollar is one driver of gold, but not the only one.

After a rough week when it appeared the gold price would extend its correction down to US$900, it stopped at US$918 and rose to close the week at US$940.70 (Comex), up $5.10 from the week before! Expect an attack on the gold price on Monday, but if the gold price can hold on to US$930 next week, then the low is behind us.

The SILVER PRICE, as always more volatile than the GOLD PRICE, took a greater wound from this week's attack. It closed up today 12.3 cents on the day, but still ended the week down 6.1 cents at $14.12.(Yesterday's commentary had the wrong price, by the way. The silver price closed at $14.00 cents, not $14.05 cents.) Right now, silver is following gold, and y'all shouldn't expect that to change any time soon. At stake here for the Nice Government Men is keeping the gold price away from US$1,000. However, gold is tugging at the leash so hard it might reach US$1,000 before the fall, unseasonal as that might be.

On the other hand, gold's strength might evaporate on Monday and we'd be left with a summer correction to fill out, and lower prices. Right now, my instincts tell me the gold price is about to move higher, and drag the silver price with it.

STOCKS dropped today 34.01 to end at 8,438.39 (S&P500 fell 1.36 to 918.90). With all the nutty projects and changes coming out of Washington, how do they expect stocks ever to rise? Stocks hate uncertainty. Meanwhile, the government is changing all the rules, day by day. Worse, all these changes place permanent drags on the economy, new costs and charges that will continue to pull it underwater long after the current crop of goofs has left DC. If I had planned to de-industrialize the US and gut its economy, I couldn't have done a better job than the US government has done since 1945. Makes you wonder whose side they are on. Anyhow, stocks will fall again next week, and probably will hit 7,800 before this particular downtrend ends.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

If the Gold Price Closes Above 940 the Bottom for this Correction is Behind Us

Gold Price Close Today : 939.10
Change: 5.00 or 0.5%

Silver Price Close Today : 14.00
Change: 9.5 cents or 0.7%

Gold Silver Ratio: 66.84
Change: -0.094 or -0.1%

Dow Industrial: 8,472.40
Change: 172.54 or 2.1%

US Dollar Index: 80.l35
Change: -0.18


Heavens! The daily charts for silver and gold prices just look too strong for a continuing correction. After making a double bottom at 918 on Monday, the gold price tried Wednesday and Thursday to bull its way through 940 without success. If it closes above 940 then the bottom for this correction is behind us. If not, bottom probably still in, but the gold price must drop back down to last bottom to prove it.



The Silver Price daily chart looks just like gold's a flat-topped rising triangle. In a sane world that would mean it's about to break out to the upside, but we are not dealing with a sane world. For the silver price, 14.06 is the barrier. A close above that says silver's bottom is in, a close below that means silver must work a while longer on the downside.

Today the silver price on Comex closed up 9.5 cents at 14.005 cents while gold closed at US$939.10, up 5.00. I know it sounds crazy after this week's drop, but both silver and gold prices look poised to rise.

The US Dollar index dropped another 18.3 basis points today to stop at 80.354. It can't even push through 81. If the dollar index closes below 79.60, it will fall at least 200 basis points.

STOCKS have probably finished their downward move for a few days. Tuesday and Wednesday appear to have put in a little double bottom at about 8,260. After the big fall stocks are due for a little countertrend bounce.

I'm so far out of the mainstream I ought to be called the slipstream or the limpid pool or maybe rain puddle. I listen to economists on NPR (I know -- why would anybody do that? The crime is its own punishment) and they must be living in a parallel universe. At least, what they all see is invisible to me. I'll tell y'all what. If the elusive "bottom of this recession" actually happens this summer as they are predicting, then I'll make a promise: I have a large-brimmed straw hat I wear to mow. Next summer this time if the economy is just a-hummin' along, I'll go out in the yard in front of y'all and everybody and I will eat that straw hat. Shoot, I'll throw in a couple of big bugs, too.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.

Gold Price Headed for US$1,300 and Higher, Most Likely by Year End

Gold Price Close Today : 923.90
Change: 3.30 or 0.4%

Silver Price Close Today : 13.834
Change: 14 cents or 1.0%

Gold Silver Ratio: 66.78
Change: -0.442 or -0.7%

Dow Industrial: 8,322.91
Change: -16.10 or -0.2%

US Dollar Index: 79.83
Change: -0.95 or -1.2%

The Silver Price closed today at 13.834, down 14, and is trapped under its 50 day moving average (now 13.81). That might mean that silver will fall to its 200 DMA (now 12.12). Markets tend often to do that, but it's not inevitable. More likely seems to me a drop to 13.00, maybe 13.50.

Why? Because the dollar lost momentum badly today, and I'm not sure it can continue to rally. Besides, time is running out for silver's seasonal low. However, other silver price indicators are not yet oversold, and I recognize that I am so bullish that I will always put the best colour on silver's outlook, as hard as I try to be objective.

Same outlook holds for gold price. It rose today 3.30 to US$923.90, but remains below its 50 DMA at 925.26. Will it drop to its 200 DMA at 870.74? Again, markets do not drop from the 50 DMA to 200 DMA every time. Over the last six months, the gold price has tended to drop back less than I expected, certainly less than the max I expected.

Torture is, you want to buy on a dip, but you can't know whether the dip is dipped out yet -- or not. Worst place to land is twisting in the breeze of indecision, blown first one way then the next, and you end up not buying anything. Keep on reminding yourself that after this correction ends, the gold price will be headed for US$1,300 and higher, most likely by year end.

When something is crazy, it invites comment. The US Dollar is crazy, so I will comment. Today the US Dollar index dropped nearly 100 basis points, 95.2 to be exact, to 79.831. Yes, it has fallen below 80 once again. This rallying project is not going to be as easy as the Nice Government Men thought. Somebody fought back today. Twice now the dollar's rally has been flung back at 81 - 81.50. What was an uptrend has now become a downtrend of lower highs and lower lows the last 7 days. Another new low tomorrow wrecks the downtrend channel and sends the dollar breaking out to the downside, contrary to my expectation.

Wow. Explain to me why the Dow won't drop to 7,800, because I can't see a reason. Indices were mixed today, some up, some down, not much movement. 'Tis a market undecided, but that generally means weakness.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2009, 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 $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.