The Moneychanger
Daily Commentary
Thursday, 26 June a.d. 2014 Browse the commentary archive

As yesterday, so today sellers attacked silver & gold in an early morning thin market, & were jaw-slapped for their troubles once again. More of that below.

Stocks broke that support I was talking about yesterday, the top line of a long established rising wedge. Just cracked it like you'd crack an egg shell, but it's cracked all the same. Dow cracked its 20 day moving average, too, but the S&P500 stopped short of that. Dow lost 21.38 (0.13%) to 16,846.13. S&P500 shaved off 2.31 (0.12%) to 1,957. Lower prices a-comin'.

Dow in silver fell again for the fifteenth straight day, and is so oversold I'm beginning to expect some sort of corrective rally. DiS lost another 5 oz (0.62%) to 797.64 (S$1,031.29 silver dollars), a scant six silver dollars from its S$1,023.46 (791.58 oz) 200 DMA.

Dow in Gold bounced up 0.05%, just a little fly-tick, to 12.79 oz (G$264.39 gold dollars). Downtrend is firm and has plenty of room to drop.

Both Dow in metals indicators are pointing to lower stock prices & higher metals prices.

US dollar index today did something unusual: closed unchanged at 80.28. It traded as low as 80.19, and as high as 80.44 around 9:30 a.m. when it tried to rally, but fell back feckless. Only encouragement in this is that the dollar index closed above its 20 DMA and slightly above important internal support at 80.25.

Euro drew near its 200 DMA ($1.3662) yesterday, but fell back today as if it were Kryptonite. No danger the euro will run away starward any time soon. Yen rose 0.11% to 98.31, continuing its baby steps to its 98.51 200 DMA, which it hit today but closed below. A close over that 200 DMA followed quickly by a close above 99.00 would send the yen rallying.

Beginning about 4:00 a.m. Eastern Time the sellers hit gold, driving it from $1,316 to $1,308. That didn't work, so about 9:00 they hit it again, forcing it to $1,306.80. Buyer's must have had their tongues hanging out watching all this, because after that print gold shot straight square up, finally reaching $1,318, then levelling off the rest of the day for a Comex close at $1,316.10, $6.10 (0.46%) lower.

Same game plan was played on silver, with just as little effect and a 2080 low. About 9:30 silver came roaring up out of that hole, then traded gently higher until it crossed 2100c. Closed Comex 8/10 of a cent lower at 2110.3.

This is all strong trading, and silver will be fine as long as it stays above 2075c - 2050c. Gold is headed higher even if it closes as low as $1,295.

Even under attack, silver & gold are proving the resilient strength of their rally.

Y'all are going to mess around and miss buying, waiting for the perfect price.

On 26 June 1844 President John Tyler of Virginia married New Yorker Julia Gardiner, the first sitting president to marry. He was 54, she was 24. He had a daughter five years older than Julia, and six other children by his first wife. With Julia he had seven more children before he died in 1862. After her husband died in 1862, Julia moved north from Virginia to Staten Island. Her home there was almost burned by enraged Union veterans when they say the Confederate flag flying on her property. After 1872 she returned to Virginia where she died in 1889. She is buried in the famous Hollywood Cemetery in Richmond, next to her husband.

On 26 June 1963 President John Kennedy gave his famous "Ich bin ein Berliner" speech at the Berlin Wall. Some Germans will gainsay it, but the "ein" before Berliner changes the meaning, so instead of saying, "I am a Berliner," Kennedy actually said, "I am a jelly donut." Those Berliners ate it up either way.

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
26-Jun-14 Price Change % Change
Gold, $/oz 1,316.10 -6.10 -0.46%
Silver, $/oz 21.10 -0.01 -0.04%
Gold/Silver Ratio 62.366 -0.265 -0.42%
Silver/Gold Ratio 0.0160 0.0001 0.43%
Platinum 1,472.10 -3.10 -0.21%
Palladium 836.20 1.95 0.23%
S&P 500 1,957.22 -2.31 -0.12%
Dow 16,846.13 -21.38 -0.13%
Dow in GOLD $s 264.60 0.89 0.34%
Dow in GOLD oz 12.80 0.04 0.34%
Dow in SILVER oz 798.28 -0.71 -0.09%
US Dollar Index 80.28 0.00 0.00%
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: 1,317.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,352.06 1,363.92 1,363.92
1/2 AE 0.50 671.57 695.14 1,390.28
1/4 AE 0.25 350.60 354.16 1,416.64
1/10 AE 0.10 139.58 144.96 1,449.58
Aust. 100 corona 0.98 1,285.25 1,294.25 1,320.39
British sovereign 0.24 312.07 324.07 1,376.68
French 20 franc 0.19 247.88 250.83 1,343.51
Krugerrand 1.00 1,332.30 1,342.30 1,342.30
Maple Leaf 1.00 1,332.80 1,347.80 1,347.80
1/2 Maple Leaf 0.50 757.74 691.85 1,383.69
1/4 Maple Leaf 0.25 336.04 352.51 1,410.05
1/10 Maple Leaf 0.10 139.69 143.64 1,436.40
Mexican 50 peso 1.21 1,580.80 1,591.80 1,320.23
.9999 bar 1.00 1,322.41 1,333.80 1,333.80
SPOT SILVER: 21.13      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 25.00 26.50 34.64
VG+ Peace dollar 0.77 22.00 24.25 31.70
90% silver coin bags 0.72 15,644.20 16,001.70 22.38
US 40% silver 1/2s 0.30 6,041.60 6,191.60 20.99
100 oz .999 bar 100.00 2,103.00 2,163.00 21.63
10 oz .999 bar 10.00 216.30 217.30 21.73
1 oz .999 round 1.00 21.23 21.73 21.73
Am Eagle, 200 oz Min 1.00 22.88 24.13 24.13
SPOT PLATINUM: 1,472.10      
Plat. Platypus 1.00 1,497.10 1,537.10 1,537.10
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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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