Silver and <b>Gold Prices</b>: <b>Gold Price</b> Acts Like a Market that Has Run <b>...</b> |
- Silver and <b>Gold Prices</b>: <b>Gold Price</b> Acts Like a Market that Has Run <b>...</b>
- The <b>Gold Price</b> Closed Down $26.50 at $1265.50
- <b>Gold Price</b> Flirting With Cost Of Production Is Not Sustainable | Gold <b>...</b>
| Silver and <b>Gold Prices</b>: <b>Gold Price</b> Acts Like a Market that Has Run <b>...</b> Posted: 28 May 2014 04:42 PM PDT
The GOLD PRICE chiseled off $6.20 (0.5%) to $1,259.30. Silver lost 4/10 of one cent to 1903.5c. The SILVER PRICE ranged a huge 19 cents today, from 1897c to 1916c, then closed 4/10 cent higher? Dead. No new sellers coming in. That argues it won't go lower, or not by much. Then there's that falling GOLD/SILVER RATIO, down from 66.624 on 23 May to 66.157 today. (By the way, don't let me forget to remind y'all to swap gold for silver. That high ratio will not last forever.) Volume dropped today too, right sharp. Y'all think about the GOLD PRICE a minute. Since last June's low it has traded in a range from $1,180 to $1,434, more narrowly $1,180 - $1,360. It double bottomed in December, and has spent most of the last year above $1,250. There's no big change here, and it acts like a market that has run out of downside momentum. Wouldn't everyone be amazed if silver turned around and blasted through 1950c in a day or two? Watch for it. As long as silver doesn't fall through 1868c, it's possible. Sometimes I don't keep my mind on what I'm doing and so overlook things. I read an article today by James Turk pointing out that yesterday was options expiration date for Comex options and Thursday expiration for OTC options. The 20 watt bulb in my dim brain flickered to life. Of course. If the black-shirts on the Comex floor can run silver and gold prices down, they'll have to pay off on futures options. This happens monthly -- how could I have forgotten? You don't have to postulate a global government/bank conspiracy for this one, just the same old thieves running things answers nicely. It's a variant of another game floor traders play called "run the stops" where they run the price down or up enough to hit the nested stops, then run the price back the other way to clear their position. If the options expiration scam was the force operating in yesterday's decline, then it was meaningless even to the short term trend. You'll know after Thursday. Market ought to come back Friday if that analysis is valid. For the nonce, at least, stocks have yet again disappointed. Too early to say for sure, thought. Dow fell back 42.32 (0.25%) to 16,633.18. S&P500 did not make another new high, yea, fell back 2.13 (0.11%) to 1,909.78. Friends, I may look silly, but it's nigh impossible to parse a topping market. S&P500 might shoot up to 2000, or it might crumple here. Either way it's riding on dandelion fluff and moonbeams. A close above the last high at 16,715.44 is needed to take the Dow higher, and I don't mean two points above that, I mean 2% or above 17,050. That would clearly state stocks are moving higher. Dow in gold barely moved today, up 0.13% from 13.20 oz yesterday to 13.22 oz (G$273.28 gold dollars), but it clean broke out of that flat topped triangle yesterday. Here's a chart, http://scharts.co/1wns6W3 Dow in silver nicked down, 0.1% to 874.74 oz (S$1,130.98 silver dollars). Here's the chart, http://scharts.co/1wnsV1c In the currency markets everybody is betting the ECB will soon "ease," or, in plain English, crank up the presses and create a tanker load of new money. This sent the Euro down again today 0.3% to $1.3594 even though the 10 year US treasury note yield dropped 3.18% today. Since currency exchange rates are largely determined by interest rate differentials (yes, and inflation expectations) the dollar ought to have weakened against the euro. Instead, it rose 18 basis points (0.22%) to 80.60. Y'all ought also bear in mind that just as a rising market attracts buyers, so a falling market attracts sellers, as rotten meat draws flies. Thus the euro's fall is feeding on itself and the news (that really is no news), and today fell past another milestone, the 200 day moving average ($1.3630). Probably several months more of falling euro lies before us. Yen doesn't know sic 'em from come here. Touched its 200 DMA above but fell away and now is vibrating around its 20 DMA. - 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.  | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| The <b>Gold Price</b> Closed Down $26.50 at $1265.50 Posted: 27 May 2014 04:04 PM PDT
Break came in silver and GOLD PRICES today, more in gold than silver. Gold sank $26.20 (2.05%) while silver only fell 34.9 cents (1.8%). The GOLD PRICE had built that long, narrow even-sided triangle which promises a breakout but always keeps shutmouthed about which way. Gold sold slowly off until it reached $1,282.50 where it began tumbling. Still, it was an orderly day, with no huge slam-downs. Today's close came near the $1,264.30 low and matches the high in 2010. In other words, this correction that began in 2011 has rolled back four years' gains in gold. Y'all don't care about that, though, y'all want to know what the gold price will do tomorrow. I don't know. Today's tumble took gold down to the April low. It might in fact stop here. Or it might repeat the pattern of the last 2 months and rally back, only to lose back in the following days. There was also a $1,240 low in January. It might catch there if today is not a one-day clean out spike. Orthodox way to measure the target would be to subtract the $63 height of the triangle from today's breakout at $1,280 for a $1,217 target. Below that are all the points clustered between $1,210 and $1,180. I don't think it will reach $1,000, as those on Wall Street pontificate, but I'm jes' a nacheral born fool from Tennessee and too durned suspicious to trust central bank money printing. Only two ways to play a break like this: you either grab it with both hands anticipating it is only a brief spike, or you wait several days to see how it shakes out. Momentum indicators look awful, but they always do at bottoms. The SILVER PRICE broke through the bottom boundary of its uptrend that began May 1, but only fell to the same 1900c area that has been support for so long. It could drop again to 1890c - 1870c, or it might drop to 1750c. From what I saw today, I'm guessing that those buyers who have been waiting for something to happen will come out of the woodwork at these prices. However this fall unrolls, I am glad to see it, because it will wash out the weak hands and set the final step in place for the silver and gold price to rally. S&P500 rose 11.38 (0.6%) to a new all-time high at 1,911.91. At 16,675.50 (up 69.23 or 0.42%), the Dow did NOT make a new all time high. S&P500's rise today above the top resistance line has to be confirmed with higher prices still -- all the more so since it's failure after the last new all-time high. Both the Dow in Gold and Dow in Silver broke out of consolidations and headed higher. I'm just waiting and watching. Dow in Gold closed at 13.20 oz (G$272.87 gold dollars) and Dow in Silver rose 2.66% to 875.58 oz (S$1,132.06 silver dollars). My target for the Dow in Silver is no higher than 912 oz (S$1,179.15). After Friday's excitement, currency markets have gone back to sleep. US Dollar Index today lost one (1) basis point to 80.42, unable to keep on rising through its 200 DMA (80.49). Euro rose 0.1% to $1.3636 on comments yesterday by ECB head Alan Greensp -- No, wait, he only SOUNDS like Greenspan, his name is Draghi. Anyway, he made noises that maybe, perhaps, possibly the ECB might have to step up inflation. When Lenin's secret police chief asked him how he would get their counterrevolutionary opponents to bite on his scheme for a phony opposition, Lenin said, "Tell them what they want to hear." The communists who rule us are still using that same tactic today. (If y'all don't understand how central bank "capitalists" might really be "communists," I'll have to explain later. Just leave it at this: maybe they never were capitalists to begin with, or maybe they're just the other side of that dialectic "communism/capitalism" that keeps most of us confused.) 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. | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| <b>Gold Price</b> Flirting With Cost Of Production Is Not Sustainable | Gold <b>...</b> Posted: 28 May 2014 02:06 PM PDT In the latest Gold Report article, Jeff Clark, senior precious metals analyst at Casey Research, has been interviewed. How are gold's fundamentals different today than they were in 1984? The fact that things are different today than in the 1980s is a really good point. The argument over methodology almost doesn't matter. Even if it were true that the gold price of 2011 matched the inflation-adjusted gold price of 1980, that wouldn't mean that gold has to go down the way it did in 1980. There wasn't a near collapse in the banking sector back then. There wasn't the Lehman Brothers upset. The government did not triple the money supply. We're dealing not with apples and oranges, but apples and whales. If history is not a map for the future, is John Williams correct that we are getting ready for hyperinflation? History never repeats itself, but it does rhyme. I agree with John Williams. On a fundamental level, profligate governments around the world have been spending beyond their means, and eventually they have to pay the piper. The longer they put it off, the bigger the bill gets. Is it all going to unravel this year? I don't know, but it's impressive that someone as cautious as John Williams seems to think that it will. But whether it happens this year or next, it doesn't really matter as long as you're investing with a long-term view. In hindsight, a lot of people have targeted last December as the bottom of the gold market. Do you look at those sorts of things in the rearview mirror? On January 6, I published a statement to the effect that both Doug Casey and I thought our market would turn upward in 2014. On February 3, I said in print that the bottom was in December. I wasn't willing to say that until the upturn was reasonably clear, but if we wait too long to take the plunge, it's of no use; when it's obvious to everyone, you lose much of the upside. Those of us who started buying in January and bought aggressively in February have benefited enormously. We were actually able to issue some profittaking calls in March before the market started correcting again. What gold number are you using to evaluate whether a company can be profitable for the rest of 2014? I have two numbers I keep in my head: spot and the three-year trailing average. It used to be cautious to use the three-year because gold prices were rising and the averages were lower than spot. Now the three-year is $200 above spot, so there are serious perception and credibility issues with using it in print. But I do still look at the three-year, because the low gold prices we have now will not last. Right now, the price of gold is flirting with cost of production—it's not sustainable. Some companies are using three price scenarios in their feasibility studies: a base case near spot, a scenario at significantly lower prices and another at significantly higher prices. Today, that more optimistic scenario is often the three-year trailing average. I like this approach; I want to see that they have a project that works right now. I want to see that if gold goes lower for a while, they're not going to dry up and blow away in the wind. And I want to see if gold goes higher, how much higher my return will be. What are your thoughts about silver compared to gold? LJ: There are vibes about silver volatility being at near-decade lows and that always precedes a surge. I'm not sure the numbers actually bear that out, other than to say, generally speaking, that low prices precede high prices because markets are cyclical. If we're at a cyclical low, it's not rocket science to say it's going to go up. That having been said, there are so many new uses for silver out there, I see very strong demand, particularly in solar panel use, which is rising and rising. My way of looking at it is that silver and gold always move together. Sometimes the ratio stretches. Sometimes it contracts. But they always move together. If you're a gold bull, you have to be a silver bull. On top of that, silver is an industrial metal, while gold is primarily a safe-haven metal. If the economy is successfully reflated by the governments of the world, then demand for silver rises. You have a safer bet on silver than gold in that respect. If, on the other hand, government efforts to save the collapse of the global economy are unsuccessful, then industrial demand may fall off, but the precious metal safe-haven demand will pick up. Where gold goes, silver goes also. It's a win-win metal. |
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