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Now, to this week:
Build the bubble, and the pricking pin will appear. Media mumblers today laid blame for stocks' plunge on fear of a Greek default. Greece is only a nearby pin for a bubble waiting to burst. US dollar index capped a bad week with more pain. Silver & gold went everywhere & nowhere. Crude oil surprised the experts & broke out upside.
Nat'ral born durn fool from Tennessee that I am, I am not above every now'n then saying, "I told y'all so!" Stocks have been fumbling & stumbling all week near the top boundary, a sign of weakness & inability to advance. Today somebody on Wall Street opened the trap door, and all the stocks fell through. Yesterday some durned fool said "watch for Dow close below 17,620 & S&P500 2,030." Those numbers looked a long ways off from 18,105.77 & 2,104.99. Today they look a lot closer, for the Dow 279.47 points closer, down 1.54% to 17,826.30. Sliced through those 20 & 50 DMAs like a straight razor & never looked back. Fell more than half the trading channel's width. Here 'tis, http://scharts.co/1HBrVwB
S&P500 lost 23.81 (1.13%) but also cut through its intertwined 20 & 50 DMAs. S&P had been forming an even-sided triangle, & now is much nearer the bottom boundary. Momentum turned down today.
All week long the Dow in metals has been jigging & fishhooking up & down with no effect. Today it turned plumb vicious. Dow in Gold lost 1.97% today to close at G$306.36 gold dollars (14.82 troy oz) -- Boom! Plunged below the 20 & 50 DMA. Snapshot here, http://scharts.co/1LTqEBF
In line with silver's weakening against gold this week the Dow in Silver didn't acquit itself quite so briskly. Fell 1.33% to S$1,420.18 silver dollars. (1,098.42 try oz). http://scharts.co/1b5tl5E
This past week most likely market the end of the corrective rally in the Dow in metals. Gravity is again setting the course.
'Tis an unbroken law in markets that parabolic rises fall as fast as they rose. US dollar index is painting another example now. Now appears that last Monday's high made a double top with the 16 March high. US dollar index fell steadily & generously throughout the week, through the 20 DMA and now nearly to the 50 (96.99). Indicators have turned down. All those hot-rock speculators will become rats & cockroaches fleeing the ship when it closes below 96.30, adding speed to the descent. http://scharts.co/1HEYhF1
Euro rose today, finally, through its 20 DMA (107.94) to close at $1.0806, up 0.37%. Chart shows a double bottom, so I reckon it is rallying, but nothing will be proved until it conquers $1.1040.
Yen rose 0.9% to 84.08. Trending up and standing above its 20 & 50 DMAs, but must break out above 84.50 to confirm a rally.
West Texas Intermediate Crude fell back 1.40% today to $55.74, but that changeth naught. Still broken out above the 2-1/2 month range and will head higher. Copper is also frisky, and broke out of a bull flag today, projecting a move to about $3.00. Interesting & comforting to see these inflation markets rising. Good for metals. Not essential, but helpful.
On Comex today gold rose $4.90 (0.04%) to $1,202.90. Silver slipped a miniscule 5-1/2 cents to 1622.1c. Silver's low this week hit 1595c.
After trading as low as 1,183.50 on Tuesday, gold closed the week only $1.70 lower. I showed this chart this week, http://scharts.co/1JNS9LC to illustrate the bowl or rounding bottom gold is forming, with a lip about $1,350.
Look, now, this is a heartening chart. When any market keeps dropping to similar points but refuses to drop further, it's tired of falling & ready to climb. Similar chart can be drawn for silver, but even better (4 stops at the bowl's bottom).
Then I showed y'all this chart, Gold measured by the US dollar index, http://scharts.co/1HByUFH Remember the dollar index measures the dollar's value against several currencies. There you see that after forming an even-sided triangle, gold broke out yesterday & stayed out today. However, it must confirm by closing above the 50 DMA. Momentum indicators promise it will. Gold is on a tear against other rotten, scrofulous, parasitic, evil fiat currencies like the euro & yen & pound & Ozzie dollar.
Silver's refusal to drop below 1595c this week makes me anticipate -- not proven yet -- that silver has formed a falling wedge that will break out upward. http://scharts.co/1HBAzv4 However, silver must first hoist itself above its 50 DMA (1643) and 20 DMA (1664).
I am wondering, too, about silver's sudden transition from stronger than gold to weaker. The gold/silver ratio ended today at 74.157, but failed to break the downtrend like this week. Looks ready to turn down again. In march it made a similar upside breakdown that failed & was followed by a huge drop. http://scharts.co/1b5Dhfz
It was a miserable week for gold & silver, but try as they might the sellers couldn't break them. That's heartening action. If gold clears $1,225, buy it or silver.
I view with suspicion -- timeo Danaos et dona ferentes -- a meeting of high monetary muckety-mucks in Washington this weekend. No telling what sort of mischief they will brew. I view even more suspiciously statements this week by an old Marxist economist named Desai who works with OMFIF to the effect that the IMF's Special Drawing Right ought to be upgraded to include gold. That's gold-plating, not reform & certainly not any gold standard. I don't want any of the Establishment's rotten fixes that only make things worse, I want real money back.
I am so proud of my office flies! I have trained them to disappear every time I pull out a flyswatter. They never miss.
With 320 million people in America, you'd think they could find somebody better to run for president than a re-tread from the Bush & Clinton families or people with annoying shrill voices. We must be dumber than I thought.
Y'all enjoy your weekend.
Argentum et aurum comparanda sunt —
Silver and gold must be bought.
— Franklin Sanders, The Moneychanger