The Moneychanger
Daily Commentary
Wednesday, 23 April a.d. 2014 Browse the commentary archive

Markets areare drifting, without much conviction one way or the other. Like a torpid snake, though, that can change any time.

On narrow ranges today stocks turned down, slightly. Dow abdicated 12.72 (0.08%) to a 16,501.65 close. S&P500 dropped 4.16 (0.22%) to close at 1,875.39.

Since markets don't make triple tops (or bottoms) but usually break through that barrier to continue higher, we can probably expect a higher top in stocks. However, the charts don't speak unequivocally. As they rise in seniority from Nasdaq Comp to S&P500 to the Dow, they look better. First two are in downtrends, Dow has moved sideways, yet the overall uptrend says they will move yet higher, unless a breakdown is confirmed. That would require universal closes below the 200 day moving averages.

Dow in gold inched down 0.19% to 12.85 oz (G$265.63 gold dollars). Dow in Silver hooked down 0.232% to 848.94 oz (S$1,098.91 silver dollars). That probably does not mark the top, although yesterdays 851.70 oz was awfully close to the 853.66 oz (S$1,103.72) December 2013 high. Yet the high lieth not far away.

US DOLLAR INDEX fell 4 basis points, nothing really, but it has been repulsed trying to climb above the 20 & 50 day moving averages, to its shame revealing its weakness. One of these days the dollar will do something, but probably not tomorrow. Drifting sideways.

Euro rose a little today, 0.8% to $1.3817, but not enough to break above its downtrend line. Not enough to sneeze at, in fact.

Yen is tippy-toeing back and over its 50 DMA. Rose 0.1% to 97.57 cents per Y100, going nowhere.

Gold added $3.60 today for a Comex close at $1,284.20. Silver closed Comex up 7.9 cents to 1943c.

Ranges today were tiny, gold's $8.70 and silver's 17 cents, but their gains bring little comfort. The overlapping trading simply doesn't depict a rally, but correction without much conviction or direction. I'm still guessing that the downside risk in gold probably isn't more than $14 from here. Silver on 15 April made a low at 1922c, and another on 21 April at 1923c. That might have fulfilled the downside thrust, but we might still witness a V-move to 1900c.

In any event, all that is my anticipating, since neither market has yet flashed a signal it is turning up. Be patient here, but don't go to sleep. I bought a good bit today to balance my own position. I don't think there's too much downside risk here, & I certainly don't want to be short.

On 23 April 1661 Charles II (Stuart) was formally crowned King of England. His so-called "restoration" became notorious for corruption and immorality, continuing the long string of Stuart accomplishments.

On 23 April 1564 William Shakespeare was born.

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
23-Apr-14 Price Change % Change
Gold, $/oz 1,284.20 3.60 0.28%
Silver, $/oz 19.43 0.08 0.41%
Gold/Silver Ratio 66.094 -0.084 -0.13%
Silver/Gold Ratio 0.0151 0.0000 0.13%
Platinum 1,403.20 3.60 0.26%
Palladium 786.25 2.35 0.30%
S&P 500 1,875.39 -4.16 -0.22%
Dow 16,501.65 -12.72 -0.08%
Dow in GOLD $s 265.63 -0.95 -0.36%
Dow in GOLD oz 12.85 -0.05 -0.36%
Dow in SILVER oz 849.29 -4.12 -0.48%
US Dollar Index 79.95 -0.04 -0.05%
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: 1,283.70      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,318.36 1,328.63 1,328.63
1/2 AE 0.50 654.18 676.19 1,352.38
1/4 AE 0.25 327.09 344.51 1,378.05
1/10 AE 0.10 134.68 140.57 1,405.65
Aust. 100 corona 0.98 1,251.99 1,260.99 1,286.46
British sovereign 0.24 304.45 309.20 1,313.51
French 20 franc 0.19 241.46 244.52 1,309.68
Krugerrand 1.00 1,301.67 1,311.67 1,311.67
Maple Leaf 1.00 1,298.70 1,313.70 1,313.70
1/2 Maple Leaf 0.50 738.13 673.94 1,347.89
1/4 Maple Leaf 0.25 327.34 343.39 1,373.56
1/10 Maple Leaf 0.10 136.07 139.92 1,399.23
Mexican 50 peso 1.21 1,539.89 1,550.89 1,286.30
.9999 bar 1.00 1,288.19 1,302.70 1,302.70
SPOT SILVER: 19.44      
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 5,541.58 5,691.58 19.29
100 oz .999 bar 100.00 1,948.50 1,998.50 19.99
10 oz .999 bar 10.00 194.85 199.85 19.99
1 oz .999 round 1.00 19.54 20.04 20.04
Am Eagle, 200 oz Min 1.00 20.94 22.14 22.14
SPOT PLATINUM: 1,403.20      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,418.20 1,435.20 1,435.20
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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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