September 1, 2009, Franklin Sanders
Today gold made its highest Comex close in history at US $1,004.90, up $9.50 for the day. It has taken gold a week to get through the resistance, but we believe it has now succeeded.
Gold opened at $999.65, quickly made a low at $997.15, then climbed straight for the ceiling and never again traded below $1,000.
This is it! Unless gold closes Monday below US $1,000, this is the Big Breakout, and will lead to a gold rise of at least $250 an ounce. Assuming we get that over one thousand dollar close on Monday, you cannot wait longer. This is the gold breakout you must buy or be left behind. Once gold settles itself over US $1,000 with a two day close, it will never trade under US $1,000 again. (John’s Note: As of 9/16/09, gold has continued to close above $1,000. Final close on 9/15/09 was $1,007.20)
This week silver traded back to 1600 cents for the last time, kissing that mark good bye forever. Silver’s high today was 1967, the low 1661, but was knocking on the 1700 ceiling all day. (John’s Note: Silver closed at $17.01 on 9/15/09.) The Comex close at 1667.60 (up only 2.6 cents) really distorts today’s results, because most of the day silver traded around 1680, and is trading there yet.
Everything said for gold applies all the more strongly to silver. We did some measuring on the silver chart today and got numbers so outlandish that I’m not going to repeat them because you simply won’t believe them – not yet, anyway.
The GOLD/SILVER ratio is about to drop VERY fast. We’re looking to trade silver for gold at 51, but that’s only a first approximation. Let it take a week or two to trade, and we’ll see then.
The DOW IN GOLD DOLLARS has turned down. Gold is about to outshine stocks blindingly.
The US DOLLAR lost 153 basis points this week. It has closed below 78.33 and 77.50 support, the last stopping point. The next logical stop is 74.50.
STOCKS seem to be forming a rising wedge, the worst possible scenario. “Twill fall like your keys out of your pocket when you lean over a well.”
Argentum et aurum comparenda sunt – Silver and gold must be bought.
All Things Considered, John’s Commentary….
Silver was, and still is, the black sheep step-child of gold. If you study the centuries old history of the relationship between gold and silver, you will quickly find that silver holds dramatically more upside potential than gold. We have been recommending an overweighting of silver for the past couple of years. However, nothing moves in a straight line and we expect to swap from silver back to gold in the not too distant future. There is as much or more money to be made from swapping back and forth between gold and silver as the ratio between the two moves in favor of one and then the other.
IF YOU ARE NOT TAKING ADVANTAGE OF THE GOLD / SILVER RATIO AND SWAPPING BACK AND FORTH BETWEEN THE TWO, YOU ARE LEAVING A LOT OF MONEY ON THE TABLE – AS MUCH AS TWO OR THREE TIMES YOUR INVESTMENT OVER THE COURSE OF THIS BULL MARKET.
For a simple overview, refer to the “Gold To Silver Ratio” page Resources > General Market Info on our website. Also, on the “Articles” page, see the article “ Silver: The metal that moves thrice faster than gold.”
– John Fisher
