The Moneychanger
Daily Commentary
Tuesday, 9 October a.d. 2012 Browse the commentary archive

Y'all outside the United States please note that yesterday was a US holiday, so the changes in prices shown below are calculated from Friday.

German chancellor Ferkel visited Greek premier Samanas today & nobody had a good time. He wants austerity delayed to 2016, she won't budge, so Greece may not get its next bailout payment.

Needless to add, this didn't help the euro's exchange rate much. It dropped 0.69% to $1.2878. This move bleeds all sorts of bad juju. It leaves the euro below $1.2900 support, & way below the $1.3000 mile marker, and barely above its 20 DMA (129.63). It gets worse. The euro is hovering above its 200 DMA (128.30), & a fall through that will draw sellers like a three day ripe road-killed armadillo draws buzzards. Twice now the euro has assayed to breach its downtrend line, twice been driven back, starting an eyecatching chain of lower highs. The 200 DMA at 128.30 is a trap door. If the euro falls through that, count on it dropping 200 basis points fast.

US$1.00 = E0.7765 = Y78.22.

Yen today rose 0.1% to 127.84 US cents. That is dancing under the wing of the 20 DMA, but changes nothing. Both the yen and the euro have posted lower highs in series against the dollar, not a hopeful sign for these loser currencies.

The other loser currency, the US Dollar index, gained 58.9 basis points (0.74%) today & closed above 80 at 80.009. Daily chart shows a strong, determined move. Longer term chart shows the dollar index has recovered from last week's false downside breakdown AND pierced its downtrend line from July. 'Tisn't yet a sure thing, but this is a strong hint at a rally that could easily touch the 50 DMA at 80.98. Won't the stock markets, the euro, and silver & gold love that?

The S&P500 in gold has failed & dropped back at its 200 DMA, after the breakdown from a broadening top in mid-August. Dow in Gold briefly penetrated its 20 DMA (2 days) then fell back to it today, after a breakdown from a diamond top in mid-August. Translation? Stocks will begin losing value against gold even faster than they have been.

The market was not kind to stocks today in dollar terms, either. The Dow caved in 110.12 (0.81%) to 13,474.53, bringing reminders that the 13,300 level is the must hold for the Dow. Owch! That close also pulled the Dow below its 20 DMA (13,521), and left behind a double top about 13,650.

'Tain't that good for the S&P500. Not only did it close below its 20 DMA (1452.24), it also violated its uptrend line. It's critical to hold 1,425.

S&P500 today buckled 14.4 points (0.99%) to 1,441.48. Odds strongly favor lower stock prices. Soon.

Silver & gold decayed more today, but without any definitive breakdown. Gold toppled $13.20 to $1,765.40 while silver backslid 81.6 cents to 3370c.

Particularly eye-catching was the Gold/Silver ratio's 0.856 point leap to 52.386 from 51.530 on Friday. Rising ratio points to falling silver & gold.

Today gold closed below its 20 day moving average, now $1,769.86. If $1,755 support holdeth not, then all will hinge on $1,738.30, the last low.

Gold has drawn a broadening top, & is breaking down from that pattern. It would have to close above $1,800 to reverse direction. Possible -- possible, not certain -- targets are $1,720, $1,690, and $1,650. Expect lower prices tomorrow.

Silver has also sketched out a broadening top and broken down from it. Losing 81.6c today was not good, but the low at 3357c almost touched the previous low at 3336c. Breaking that 3336c low would push silver back to its 300 DMA (3221) or lower, to 3200c or 3100c.

I ought to add that silver & gold must confirm these falls with lower closes tomorrow.

You are watching nothing more than a usual correction after a long rally. Stay calm, watch closely for a buying opportunity that ought to come soon.

On 9 October 1779 the first Luddite riots began when workers smashed new cotton spinning machinery they feared would take their jobs. Their supposed leader was Ned Ludd. Again in 1812-1816 similar riots broke out in other parts of England to protest the new machinery that could be run by unskilled workers. At one point Great Britain had more troops in the field fighting Luddites in England than it had in Spain fighting Napoleon, and generously hanged & transported all the Luddites they could catch.

A similar term, sabotage, comes from a similar protest in the Netherlands in the 15th century when workers threw their sabots (wooden shoes) into the machinery. The term Luddite has come to describe anyone opposed to industrialization, automation, computerization, new technologies, or government control of the economy.

Wait. Did I get that right? I reckon Luddite is in the eye of the beholder.

I've been meaning to share with y'all a humble but effective help for joint pain. I've suffered from tendonitis in my ankle for more than five years. A friend recommended 2 tablespoons of organic apple cider vinegar with one tablespoon of raw honey or grade B maple syrup mixed in 8 oz. of water.

What had I to lose? I tried it, and in two days my ankle's pain and soreness was lessened 90%. I mentioned it to a friend with bursitis, he took it, & it was much better the next day.

I ought to have remembered this. It was recommended by Dr. Jarvis, a Vermont country doctor, in his 1958 book, Folk Medicine. Give it a try. I use Bragg's Organic Apple Cider Vinegar "with the mother," i.e., the "mother of vinegar." That's a harmless bacteria that turns alcohol into vinegar, a sort of milky haze in the vinegar. If it doesn't work, you can use the vinegar to make salad dressing.

Yes, you have to keep on taking it.

Argentum et aurum comparanda sunt —
Silver and gold must be bought.

— Franklin Sanders, The Moneychanger

Your source for gold and silver. Read our latest reviews and testimonials.
Market Snapshot See more charts and market data
9-Oct-12 Price Change % Change
Gold, $/oz 1,765.40 -13.20 -0.74%
Silver, $/oz 33.70 -0.82 -2.36%
Gold/Silver Ratio 52.386 0.856 1.66%
Silver/Gold Ratio 0.0191 -0.0003 -1.63%
Platinum 1,693.50 -9.80 -0.58%
Palladium 657.50 -4.25 -0.64%
S&P 500 1,441.48 -14.40 -0.99%
Dow 13,473.53 -110.12 -0.81%
Dow in GOLD $s 157.77 -0.09 -0.06%
Dow in GOLD oz 7.63 -0.00 -0.06%
Dow in SILVER oz 399.81 6.26 1.59%
US Dollar Index 80.01 0.59 0.74%
IMPORTANT NOTE: The following are wholesale, not retail, prices. To figure our retail selling price, multiply the "ask" price by 1.035. To figure our retail buying price, multiple the "bid" price by 0.97. Lower commissions apply to larger orders, higher commissions to very small orders.
SPOT GOLD: 1,764.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,810.68 1,825.68 1,825.68
1/2 AE 0.50 899.54 926.52 1,853.04
1/4 AE 0.25 454.18 467.67 1,870.69
1/10 AE 0.10 186.96 191.48 1,914.81
Aust. 100 corona 0.98 1,721.21 1,731.86 1,766.84
British sovereign 0.24 415.43 419.43 1,781.79
French 20 franc 0.19 329.49 333.49 1,786.22
Krugerrand 1.00 1,780.68 1,795.68 1,795.68
Maple Leaf 1.00 1,774.80 1,794.80 1,794.80
1/2 Maple Leaf 0.50 873.58 917.70 1,835.39
1/4 Maple Leaf 0.25 436.79 467.67 1,870.69
1/10 Maple Leaf 0.10 174.72 190.60 1,905.98
Mexican 50 peso 1.21 2,110.62 2,127.62 1,764.64
.9999 bar 1.00 1,770.98 1,781.98 1,781.98
SPOT SILVER: 33.92      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 26,000.00 27,750.00 36.27
VG+ Peace dollar 0.77 25,000.00 27,500.00 35.95
90% silver coin bags 0.72 24,074.05 24,324.05 34.02
US 40% silver 1/2s 0.30 9,814.65 10,014.65 33.95
100 oz .999 bar 100.00 3,392.00 3,442.00 34.42
10 oz .999 bar 10.00 344.20 346.70 34.67
1 oz .999 round 1.00 33.77 34.62 34.62
Am Eagle, 200 oz Min 1.00 35.52 36.17 36.17
SPOT PLATINUM: 1,693.50      
Plat. Platypus 1.00 1,718.50 1,758.50 1,758.50
Home Questions & Answers Articles & Resources
The Moneychanger, P.O. Box 178, Westpoint, TN 38486

Copyright Notice

© 2015 Little Mountain Corporation, d.b.a. The Moneychanger. All rights reserved. May not be republished in any form, including electronically, without our express permission.

Warnings and Disclaimers

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 trend is up, targeting 16:1 gold/silver ratio or $195.66; stock's primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 16 ounces of silver. US$ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down.

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 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. For additional information, please see our Ten Commandments for Buying Gold and Silver.
  • One final warning: NEVER insert a 747 Jumbo Jet up your nose.

Explanation of Terms

The US DOLLAR INDEX is the average exchange rate for the US dollar against the Euro, Yen, Pound sterling, Canadian Dollar, Swiss Franc, and Swedish Krona, weighted for each country's trade with the US. It gives a general measure of the US dollar's performance against all other currencies.

The DOW IN GOLD DOLLARS measures the Dow Jones Industrial Average in gold dollars (0.048375 troy oz. by law). The DiG$ depicts the Primary (20 year) Trend of stocks against gold. When the DiG$ is dropping, gold is gaining value against stocks in a trend that should last 15-20 years. The DiG$'s chart is identical to the Dow in ounces of gold, but gives us one unvarying measure all the way back to 1896. Because it shows the primary trend ("tide") of gold against stocks, for investors it is the single most important financial chart in the world today. Since its August 1999 high at G$925.42 (44.8 ounces), the DiG$ has trended down, targeting a G$80-G$20 (4-1 oz. of gold will buy the whole Dow).

The DOW IN SILVER OUNCES shows how many ounces of silver are needed to buy the entire Dow. The DiSoz is trending down with a target of under 36 ounces.

The GOLD/SILVER RATIO is the gold price divided by the silver price, and shows how many ounces of silver it takes to buy one ounce of gold. The Ratio shows us the Primary (20 year) Trend of gold's value against silver. When the Ratio's trend is dropping, silver is gaining value against gold. This trend targets a gold/silver ratio of 16 ounces of silver to one of gold within the next 5-10 years. That implies that silver will massively, vastly outperform gold before this bull market ends. When both metals are rallying, the ratio often (but not always) drops, confirming the rally.

Other Important Information

This is not an offer to buy or sell. Prices subject to change without notice. To enter an order, call us at (888) 218-9226 or (931) 766-6066. Sorry, no sales to Tennessee.

For complete details on how to buy from us or sell to us, please click here.