The Moneychanger
Daily Commentary
Wednesday, 22 April a.d. 2015 Browse the commentary archive

The good news is health conscious consumers are avoiding McDonald's. The bad news is McDonald's net income is dropping worldwide (down 33% Q1/14 to Q1/15). The cRaZy news is that on this earnings report, McDonald's stock rose 3% today.

Even on McDonald's rotten earnings, stocks rose. Dow added 88.68 points as it swings up and down with all the deep meaning of one of those bobbing head dogs in your back car window. Ended up 0.49% at 18,038.27. S&P500 added 10.67 (0.51) to 2,107.96. cRaZy.

Could stocks break out here and move to a new high? Well, they keep stalling at the upper boundary of trading channel/formation, but they are above their 20 & 50 day moving averages -- until they again fall out of bed.

Today saw a little larger move from the Dow in Gold. Up 1.76% to G$314.21 gold dollars (15.20 troy ounces). Dow in silver climbed 1.9% to S$1,479.84 silver dollars (1,144.56 troy ounces).

Okay, so I'm biting nails -- fingernails -- as the DiS approaches that top gator jaw, tomorrow about S$1,491.39 (1,153.5 oz). I told y'all these broadening tops will make you pull out you hair in tufts & handfuls.

US dollar index closed lower, down 7 basis points or 0.07% at 98.14, but not as low as its lowest, 97.61, now under the 20 DMA. Makes that breakout through the downtrend that peaked at 100.27 on 13 March look even more bailed now than it did before. However, Dollar Index must break 96.50 to fall past recent lows. Gravity is in charge.

Nobody's in charge at the euro. It lost 0.08% to $1.0725. Too puny & peak├ęd to lift a leg over its 20 DMA. Sick.

Watching the yen is as thrilling as watching a clock pendulum: up, down, up, down, in the identical range since February. Fell 0.175 today to 83.35. Headed sideways.

Silver & gold are trying to knock out that floor underneath. Gold slipped $16.00 (1.3%) to $1,186.90 while silver dropped 21.1 cents to 1579.1c.

The Gold/Silver ratio closed Comex at 75.163, slightly lower than yesterday's 75.172, but there's more there than those bald numbers. Ratio hit a high at 76.25, punched into resistance, then closed lower than yesterday, first half of a key reversal. Second half (a lower close) must follow tomorrow.

Gold's $1,185 low today nearly matched the 14 April low at $1,183.50. That nearly touches the 2-standard deviation bottom Bollinger band and, just below, the downtrend line from the October 2012 high. Wait, did I forget to tell y'all that since April opened gold has been above that line? Sorry. But I might be forgiven because it also traded above that line in January, but couldn't stay there.

If gold faints here it will fall to $1,165. I expect support there to hold. For one reason, because gold has lately acted as if selling is about exhausted.

Silver's low came at 1565c, and silver must hold here or retreat to 1525 - 1500c. Silver's at its 2-sigma Bollinger band, at support from the December low, at the peak of a falling wedge -- if it can't stop here, it can't stop. http://scharts.co/1DPm0RR

On 22 April 1659 Lord Protector Cromwell disbanded the English parliament, bringing the revolution full circle from monarchical dictator to common dictator. It's the life cycle of revolutions.

On 22 April 1792 President George Washington proclaimed US neutrality in the war in Europe. Needless to say, what we've had the last, oh, 155 years or so ain't been Washington.

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
22-Apr-15 Price Change % Change
Gold, $/oz 1,186.90 -16.00 -1.33%
Silver, $/oz 15.79 -0.21 -1.32%
Gold/Silver Ratio 75.163 -0.009 -0.01%
Silver/Gold Ratio 0.0133 0.0000 0.01%
Platinum 1,129.70 -22.10 -1.92%
Palladium 755.60 -18.65 -2.41%
S&P 500 2,107.96 10.67 0.51%
Dow 18,038.27 88.68 0.49%
Dow in GOLD $s 314.17 5.70 1.85%
Dow in GOLD oz 15.20 0.28 1.85%
Dow in SILVER oz 1,142.31 20.60 1.84%
US Dollar Index 95.00 0.04 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: 1,186.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,212.40 1,227.82 1,227.82
1/2 AE 0.50 604.50 625.77 1,251.55
1/4 AE 0.25 305.21 318.82 1,275.27
1/10 AE 0.10 124.46 129.90 1,299.00
Aust. 100 corona 0.98 1,157.00 1,166.00 1,189.55
British sovereign 0.24 281.35 294.35 1,250.42
French 20 franc 0.19 223.14 227.14 1,216.62
Krugerrand 1.00 1,196.98 1,206.98 1,206.98
Maple Leaf 1.00 1,194.30 1,210.30 1,210.30
1/2 Maple Leaf 0.50 682.12 622.81 1,245.62
1/4 Maple Leaf 0.25 302.51 317.34 1,269.34
1/10 Maple Leaf 0.10 125.75 129.31 1,293.07
Mexican 50 peso 1.21 1,417.33 1,428.33 1,184.65
.9999 bar 1.00 1,190.45 1,198.30 1,198.30
SPOT SILVER: 15.75      
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 11,793.93 12,043.93 16.84
US 40% silver 1/2s 0.30 4,453.03 4,603.03 15.60
100 oz .999 bar 100.00 1,564.50 1,614.50 16.15
10 oz .999 bar 10.00 156.45 161.95 16.20
1 oz .999 round 1.00 15.85 16.35 16.35
Am Eagle, 200 oz Min 1.00 17.25 18.10 18.10
SPOT PLATINUM: 1,129.70      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,144.70 1,174.70 1,174.70
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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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