The Moneychanger
Daily Commentary
Monday, 24 November a.d. 2014 Browse the commentary archive

For the third day running the Dow & S&P500 have made new highs by small numbers. Dow today added 0.4% or 7.84 to 17,817.90. SP500 rose 5.91 (0.29%) to 2,069.41. You tourists, hear me say this: this ain't normal. This persisteth not.

Dow in gold closed at 14.904 near its 20 DMA (14.86 oz) where it closed Friday.. Dow in silver punched through its 20 DMA on Friday, but closed a little higher today at 10,8798. Still below the 20 DMA at 1,089.79. All indicators point down.

US dollar index lost 19 basis points (0.22%) and ended at 88.17. Right now the dollar is key to silver & gold. If it moves higher, as it bids now to do immediately, It will weigh heavily on metals. More important, in my little mind, is that stocks turn down against silver & gold, but a rapidly rising dollar will surely hurt metals.

Gold today lost $2 & ended at $1,195.50. Silver lost 1.4 cents to stop at 1637.7c.

The empyrean ringeth not with paeans of praise for the metals. Gold has reached its 50 day moving average and stalled, about what you'd expect for no more than a correction from the waterfalls of October. Throwing the steely eyeball on it, gold needs to punch through $1,206.74 (the 50 DMA) & march right on towards $1,255.60. Otherwise more downside loometh.

Silver has lacked even more luster. It hasn't even reached its 50 DMA. Weakness & sloth here does not point to good times ahead. Silver needs to rise through 1700c, and soon.

Yes, there are good signs on both charts, hopeful signs, signs that suggest both ought to float higher, but spinning wheels just burns up gas. They both have to move ahead, and this week -- O Mercy -- threatens to be a dead one.

In plain English, silver & gold must rise smartly, or fall smartingly.

On 24 November French King Louis XIII married Ann of Austria. They were both 14 years old. They married a lot younger in those days. Louis was only a year older than his number.

On 24 November 1963 Jack Ruby fatally shot Lee Harvey Oswald, then in police custody charged with assassinating John F.. Kennedy, thus most effectively ending any trail of evidence from Oswald elsewhere. Ruby later died in jail from lung cancer, wiping out that trail.

On 24 November 1971 hijacker D.B. Cooper parachuted from a Northwest Airlines 727 over Washington state with $200,000 in ransom. He was never found.

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-Nov-14 Price Change % Change
Gold, $/oz 1,190.70 -2.90 -0.24%
Silver, $/oz 16.13 -0.16 -0.96%
Gold/Silver Ratio 73.805 0.533 0.73%
Silver/Gold Ratio 0.0135 -0.0001 -0.72%
Platinum 1,208.00 -19.80 -1.61%
Palladium 789.75 -4.80 -0.60%
S&P 500 2,069.41 5.91 0.29%
Dow 17,817.90 7.84 0.04%
Dow in GOLD $s 309.34 0.89 0.29%
Dow in GOLD oz 14.96 0.04 0.29%
Dow in SILVER oz 1,104.44 11.13 1.02%
US Dollar Index 88.17 -0.19 -0.22%
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: 1,197.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,227.75 1,239.72 1,239.72
1/2 AE 0.50 616.35 631.84 1,263.68
1/4 AE 0.25 308.18 321.91 1,287.64
1/10 AE 0.10 125.66 131.16 1,311.59
Aust. 100 corona 0.98 1,165.86 1,177.86 1,201.66
British sovereign 0.24 283.65 295.65 1,255.96
French 20 franc 0.19 225.31 228.43 1,223.51
Krugerrand 1.00 1,213.37 1,223.37 1,223.37
Maple Leaf 1.00 1,212.80 1,227.80 1,227.80
1/2 Maple Leaf 0.50 688.74 628.85 1,257.69
1/4 Maple Leaf 0.25 305.44 320.41 1,281.65
1/10 Maple Leaf 0.10 126.97 130.56 1,305.60
Mexican 50 peso 1.21 1,436.85 1,460.85 1,211.62
.9999 bar 1.00 1,201.99 1,213.80 1,213.80
SPOT SILVER: 16.44      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.75 26.50 34.64
VG+ Peace dollar 0.77 18.50 22.00 28.76
90% silver coin bags 0.72 13,041.60 13,399.10 18.74
US 40% silver 1/2s 0.30 4,658.05 4,808.05 16.30
100 oz .999 bar 100.00 1,634.00 1,694.00 16.94
10 oz .999 bar 10.00 169.40 170.40 17.04
1 oz .999 round 1.00 16.54 17.09 17.09
Am Eagle, 200 oz Min 1.00 18.19 19.19 19.19
SPOT PLATINUM: 1,208.00      
Plat. Platypus 1.00 1,233.00 1,273.00 1,273.00
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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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