The Moneychanger
Daily Commentary
Tuesday, 31 March a.d. 2015 Browse the commentary archive

Somebody left the champagne out all night and all the bubble went away today. As I observed yesterday, it was all hogbreath, & hogbreath just blows away.

Dow lost 200.19 of those 263.65 points it gained yesterday, falling 1.11% to 17,776.12. Volatility eats up buying power like spinning wheels in mud burns gas & eats up tires. S&P500 tumbled 18.35 (0.88%) to 2,067.89

'Cause I'm a durned ol' nat'ral born fool from Tennessee won't nobody listen to me when I point out stocks are showing all the signs of topping, may have already made their final high on 2 March, & are now in an established downtrend. These are facts, but I'd have to be selling stocks on Wall Street and wearing sharkskin suits and pointy toed patent leather shoes to get anybody to believe me. Wearing overalls & herding cows just don't earn no respect, but it does add a whole new dy-menshun to "stock broker."

The corks are a-poppin' in the US dollar index, which has traded above its 20 day moving average. Looks like the dollar gamblers are bidding it up again, in a self-reinforcing cycle of buying and greed. Dollar index gained 36 basis points (0.37%) to 98.64. I reckon this will play out soon, but it might not.

Silver & gold both ran out of downside momentum today. Gold inched back $1.70 to 1,183.10 while silver scraped off 7.6 cents to 1658.1c.

Gold's 50 dma ($1,216) is stacked above its 20 DMA ($1,176.23). Today at its $1.178.20 low gold nearly bumped into it. That would be a fine place to turn around, but it might take $1,168 to do the trick.

Looking at silver through the same lens, its 20 DMA stands at 1623. Coincidentally, that's where support from the shoulder line comes in.

Y'all know that technical analysis assumes that a "trend in force remains in force until invalidated." However, invalidating positively entails waiting (in the case of a downtrend) for a huge rise.

Still and all, give the proverb its proper honor. Silver & gold have been downtrending since 2011. They have to prove an upward reversal one step at a time. A good step here would be holding on above 1620c & $1,160.

If those are violated, we just go back to watching and waiting, but here you see markets' trickiness. If you pass on buying by listening to the proverb, and they turn up here, you missed a bottom. However, buying here entails also the risk that it won't stop at those points.

It's enough to make a man take up the dog-grooming business, something with a solid future.

Y'all don't miss this story at "Medieval garlic & bile potion kills MRSA superbug." Seems the 10 century Bald's Leechbook has a recipe for eye infections using garlic, wine, and cow bile. They made it up and tried it on superbugs, and, well, go read it.

However, so-called science is, as usual, a little late coming to the game. Garlic has LONG been known for its antibacterial properties. It may give you hogbreath, but that garlic will keep you healthy.

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
31-Mar-15 Price Change % Change
Gold, $/oz 1,183.10 -1.70 -0.14%
Silver, $/oz 16.58 -0.08 -0.46%
Gold/Silver Ratio 71.353 0.223 0.31%
Silver/Gold Ratio 0.0140 -0.0000 -0.31%
Platinum 1,142.60 25.70 2.30%
Palladium 735.00 6.30 0.86%
S&P 500 2,067.89 -18.35 -0.88%
Dow 17,776.12 -200.19 -1.11%
Dow in GOLD $s 310.59 -3.05 -0.97%
Dow in GOLD oz 15.03 -0.15 -0.97%
Dow in SILVER oz 1,072.08 -7.13 -0.66%
US Dollar Index 98.64 0.36 0.37%
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: 1,183.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,215.35 1,224.82 1,224.82
1/2 AE 0.50 603.02 624.24 1,248.49
1/4 AE 0.25 304.47 318.04 1,272.16
1/10 AE 0.10 124.15 129.58 1,295.82
Aust. 100 corona 0.98 1,154.17 1,163.17 1,186.66
British sovereign 0.24 280.66 285.66 1,213.52
French 20 franc 0.19 222.60 226.60 1,213.70
Krugerrand 1.00 1,196.42 1,206.42 1,206.42
Maple Leaf 1.00 1,191.40 1,207.40 1,207.40
1/2 Maple Leaf 0.50 680.46 621.29 1,242.57
1/4 Maple Leaf 0.25 301.77 316.56 1,266.24
1/10 Maple Leaf 0.10 125.44 128.99 1,289.91
Mexican 50 peso 1.21 1,416.72 1,427.72 1,184.14
.9999 bar 1.00 1,187.54 1,195.40 1,195.40
SPOT SILVER: 16.62      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 26.00 33.99
VG+ Peace dollar 0.77 18.50 21.00 27.45
90% silver coin bags 0.72 12,558.98 12,916.48 18.07
US 40% silver 1/2s 0.30 4,709.68 4,859.68 16.47
100 oz .999 bar 100.00 1,651.50 1,716.50 17.17
10 oz .999 bar 10.00 165.15 171.65 17.17
1 oz .999 round 1.00 16.72 17.22 17.22
Am Eagle, 200 oz Min 1.00 17.62 18.97 18.97
SPOT PLATINUM: 1,142.60      
Plat. Platypus 1.00 1,157.60 1,187.60 1,187.60
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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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