The Moneychanger
Daily Commentary
Thursday, 27 March a.d. 2014 Browse the commentary archive

Y'all have mercy on me today. I have to attend a show-off home schooling event for some of my grandchildren, & my dear wife will flay me if I'm late.

Here are the highlights. Stocks continued to deteriorate, although the closes didn't show the full view of it. Closes were near yesterdays, but the lows were a lot lower, so the range was much lower than yesterdays. Whoa! S&P500 broke DOWN out of that even-sided triangle we've been watching. Dow lost 4.76 (0.03%) to 16,264.23 while the S&P500 slid 3.52 (0.19%) to 1,849.04. Should follow through lower & lower.

US dollar index finally stood up and gained a whole 16 basis points (0.2%) to 80.28. This leaves the chart hopeful, but nothing to brag about. Euro looks like it ate a pound of bad meat, dropped 0.32% today to $1.3741, not far from turning very negative by falling below its 50 DMA ($1.3715). Yen lost 0.14% to 97.87 c/Y100, still treading water.

Gold sank $8.70 to $1,294.70 and silver lost 6.9 cents to 1969.0c. Disaster? Not quite. Today's range with a 1958c low touched the downtrend line form the April 2013 high, same line silver broke through skyward in April. This constitutes a kiss back to breakout, and should hold -- should.

Gold's low at $1,291.20 brought it nearly to that 50% correction at $1,287, which is the neckline of the upside down Head & Shoulders gold broke through in February. Gold has now tangled its feet in the 50 DMA ($1,303.8) & 200 DMA ($1,299.41). Today's trading pretty much hit my targets for this decline. Now we might from here get a rally, then one more touch back to these levels.

Of course, I will be shown once again to be no more'n a nacheral born fool from Tennessee should silver & gold drop sharply. Fool or not, I don't see that on the chart.

27 March 1863 was appointed by President Jefferson Davis to be a day of prayer and fasting. Merely to state such a thing reveals the unlikelihood of such an appointment today.

On 27 March 1814 at the Battle of Horseshoe Bend in Alabama Tennessee General Andrew Jackson defeated the Red Sticks of the Creek tribe.

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

— Franklin Sanders, The Moneychanger

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Market Snapshot See more charts and market data
27-Mar-14 Price Change % Change
Gold, $/oz 1,294.70 -8.70 -0.67%
Silver, $/oz 19.69 -0.07 -0.35%
Gold/Silver Ratio 65.754 -0.211 -0.32%
Silver/Gold Ratio 0.0152 0.0000 0.32%
Platinum 1,397.20 -9.30 -0.66%
Palladium 761.00 -20.15 -2.58%
S&P 500 1,849.04 -3.52 -0.19%
Dow 16,264.23 -4.76 -0.03%
Dow in GOLD $s 259.68 1.66 0.64%
Dow in GOLD oz 12.56 0.08 0.64%
Dow in SILVER oz 826.01 2.64 0.32%
US Dollar Index 80.11 0.03 0.04%
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: 1,291.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,324.10 1,337.01 1,337.01
1/2 AE 0.50 658.31 680.46 1,360.91
1/4 AE 0.25 329.15 346.69 1,386.75
1/10 AE 0.10 135.53 141.45 1,414.52
Aust. 100 corona 0.98 1,259.89 1,268.89 1,294.52
British sovereign 0.24 306.37 311.12 1,321.67
French 20 franc 0.19 242.99 246.03 1,317.78
Krugerrand 1.00 1,306.01 1,316.01 1,316.01
Maple Leaf 1.00 1,306.80 1,321.80 1,321.80
1/2 Maple Leaf 0.50 742.79 678.20 1,356.39
1/4 Maple Leaf 0.25 329.41 345.56 1,382.23
1/10 Maple Leaf 0.10 136.93 140.81 1,408.06
Mexican 50 peso 1.21 1,549.61 1,560.61 1,294.36
.9999 bar 1.00 1,296.32 1,310.80 1,310.80
SPOT SILVER: 19.69      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 26.25 28.25 36.93
VG+ Peace dollar 0.77 22.25 23.75 31.05
90% silver coin bags 0.72 14,861.28 15,111.28 21.13
US 40% silver 1/2s 0.30 5,615.33 5,765.33 19.54
100 oz .999 bar 100.00 1,973.50 2,023.50 20.24
10 oz .999 bar 10.00 197.35 202.35 20.24
1 oz .999 round 1.00 19.79 20.29 20.29
Am Eagle, 200 oz Min 1.00 21.19 22.39 22.39
SPOT PLATINUM: 1,397.20      
Plat. Platypus 1.00 1,412.20 1,429.20 1,429.20
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© 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.

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