Editors Note: Please note we posted incorrect gold and silver prices in Franklin
Sanders Commentary yesterday, due to no fault of Franklin Sanders. The correct
prices are now posted. Our apologies for any confusion caused. If only gold was
1242 and silver 18.59, I think we can safely say you will never see those prices
for gold and silver again on goldprice.org! Gold Price Close Today : 1454.90
Change : 2.00 or 0.1% Silver Price Close Today : 40.235 Change : 0.177 cents or
0.4% Gold Silver Ratio Today : 36.16 Change : -0.110 or -0.3% Silver Gold Ratio
Today : 0.02765 Change : 0.000084 or 0.3% Platinum Price Close Today : 1772.50
Change : -0.70 or 0.0% Palladium Price Close Today : 763.10 Change : -0.40 or
-0.1% S&P 500 : 1,314.41 Change : 0.25 or 0.0% Dow In GOLD$ : $174.35 Change : $
(0.12) or -0.1% Dow in GOLD oz : 8.434 Change : -0.006 or -0.1% Dow in SILVER oz
: 304.98 Change : 0.17 or 0.1% Dow Industrial : 12,270.99 Change : 7.41 or 0.1%
US Dollar Index : 74.99 Change : 0.139 or 0.2% If you were waiting for a
meaningful message from the US DOLLAR INDEX today, you might as well go search
the Collected Speeches of Barak Obama for wisdom. Today it rose 13.9 basis
points to trade now at 74.992. Notice, if you are not already bored to death by
this performance, that it just could not QUITE close over the magic 75.00
number. The stench of death and weakness clogs the air. The dollar's leprous
colleagues, the euro and yen, did not edify, either. The euro closed at 1.4441,
and appears to have hit its new high yesterday and reversed, but follow thru
must confirm. The yen has with great spirit and verve rallied up to its 200 day
moving average. Don't count on it penetrating. Lats price I saw was 83.86Y/$
(119.24c/Y100). A reader rebuked me for my clumsy description of the relation
between bonds and yields. It is true that the nominal value of a bond depends on
the interest rate stated on its face, but that wasn't what I was trying to point
out. Rather, the price of bonds varies inversely with market interest rates. If
rates rise, bond prices fall; if rates fall, bond prices rise. Yield is what the
bond will in fact return, taking into account its stated interest rate and
market rates. Stated rate never changes, but yield changes with market interest
rates. So when bond prices fall without the Federal Reserve changing its
benchmark interest rate, that implies the market expects (1) lower dollar
prices, or (2) higher interest rates. Test on Friday. STOCKS did nothing to
build confidence today. Dow's low came at 12,224.45, a little below its 20 day
moving average (12,231), then closed 7.41 gigantic points higher at 12,270.99.
S&P500 darted, bobbed, and weaved at a perfectly glacial pace, adding 0.25 --
yes, 1/4 of a point -- to close 1,314.41. I feel sort of ashamed about all
badmouthing stocks so much -- feel sorry for them, so I'll try to say something
really nice about them today. STOCKS are the mercurochrome in the Investing
Medicine Chest, but they could hurt worse. They could be the tincture of iodine.
I don't have a lot of good news about GOLD and SILVER for y'all, but I do have
some richly exciting suspicions. The GOLD PRICE rose $2.00 by the time Comex
closed, to $1,454.90. High struck at $1,462, low at $1,450.95. This is not
strong at all, but it's not a breakdown, either. Two things can happen from
here: gold can rise, or gold can fall. Wait, wait, that's not as dumb as it
sounds. Gold's behavior could be consistent with two opposite outcomes. First,
the 5 day chart might be showing us a completed A-B-C correction, with the low
yesterday at $1,444. Arguing for that is the uptrend in place (higher highs and
lower lows) since Tuesday's low. The rise we saw from yesterday's low to today's
high could be the first leg up of a renewed rally. Exciting suspicion, but I
have yet another. First, tho, the "Gold can fall" outlook. Gold failed to meet,
let alone better, this week's high, so Monday's key reversal has still capped
the market and will force it further down. If gold trades below $1,450 tomorrow,
it will likely signify lower prices coming. Trading above $1,465 makes higher
prices and a renewed rally more likely. The SILVER PRICE offers more exciting
suspicions still. As with gold, the 5day chart shows an embryonic uptrend from
Tuesday's low. It may have completed a correction. More than that, silver closed
up 17.7c (no big deal) at 4023.5cd, yet in the aftermarket has traded up nearly
40c to 4062c. And that trading from yesterday's low looks like a rallying move.
Yet these remain only exciting suspicions, o'ershadowed by that gold's Monday
key reversal, and silver's failure to rise today above yesterday's high. Silver
must hold 3960c or tumble quickly earthward. Overhead, clearing 4080c and
trading on up would signal the correction is very small and the rally is
resuming. On this day in 1742 Georg Fredric Handel's Messiah was performed for
the first time in Dublin. The fellow who wrote the libretto, whose name nobody
remembers, wrote to a friend saying that his libretto was magnificent but he
wasn't so sure about Handel's music. He might have spoken a bit prematurely.
Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. -
Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2011, 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. Whenever I write "Stay out of stocks" readers inevitably ask,
"Do you mean precious metals mining stocks, too?" No, I don't.
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