The Moneychanger
Daily Commentary
Wednesday, 13 May a.d. 2015 Browse the commentary archive

Chart after chart pressed the same breathless WHOA out of me this afternoon as I opened them.

Take the US dollar index: down 85 basis points (0.89%) to 93.76, smashing support barely below 94. Next real support I can point to is 90.34.

Now look at the Gold/US Dollar Index spread, http://schrts.co/lEHI64 It gapped up today and left behind resistance at 12.63-12.75. Rose 3.08% to close at 12.99. More than that, the indicators still point further up. WHOA.

Even rising 1.17% today to $1.1346 the Euro couldn't clear $1.14. Ok, give it some credit: that will probably come tomorrow.

Yen jumped, too, 0.53% to 83.90 & managed to clear its 20 DMA. Remember it remains in a range bounded by 82.25 & 84.30.

US 10 year Treasury note yield rose 0.97% to end at 2.282%; 30 year bond yield jumped up 1.69% to close 3.0715. The 10 year yield had dropped below its 200 DMA last Friday, after spending two days above it. However, it came back Monday and smashed the 200DMA, made a higher high but backed off yesterday, then nearly touched the 200 DMA today and closed much higher. Classic touch-back behavior that ought to lead to higher prices. Chart is here, http://schrts.co/vUJO4G

Whoops, point of this 200 DMA discussion is that the 30 year yield broke through a week ago, touched back, & then took off. Both are steadily adding confirmation to an upside breakout of interest rates.

Wonder if Janet Yellen's puking in her wastebasket yet? Pepto Bismol won't help that kind of pukin', Janet.

Stocks made no headway again today, but rather fainted. Dow tried to rise but ended up 7.74 lower at 18,060.49. S&P500 scratched off 0.64 to end up 2,098.48 and below its 20 DMA.

After torturing us again by returning to the upper gator jaw, Dow in Gold fell completely off the porch today, cutting through the 20 & 50 DMA at G$312.14 (15.10) and G$312.35 (15.11 oz). Fell 2.15% to G$306.56 (14.83 oz).

Dow in silver fell off the porch and into the briars, down 4.17% to S$1,355.96 silver dollars (1,048.75 oz). 200 DMA awaits at S$1,328.07 (1,027.18 oz). Charts at http://schrts.co/8Sv0tc and http://schrts.co/ohwLZP WHOA.

WHOA. I was utterly unprepared for the Gold/Silver ratio dropping two percent to 70.808, gapping down hugely below its 200 DMA at 71.44. Look for yourself at http://schrts.co/kh9gOy If y'all are EVER going to swap gold for silver to take advantage of the coming huge drop in the ratio, now is probably your last chance.

Gold leapt $25.80 (2.16%) to close at $1,218.40, top of its range. Silver doubled that, up 4.22% or 69.7 cents to 1720.7 cents.

My daily gold chart doesn't agree with what my eyes saw today. When I first looked at a gold's price this morning about 10:00 a.m. (11 Eastern), it was already above $1,214. Excuse given by the media is that lower US retail sales bumped down the dollar and up gold. This makes some sense to me since the dollar index began falling about 8:30 this morning.

But what's wrong with that picture? Disappointing retail sales did all that damage to the dollar? Naw, it broke through that 94 support. And gold has been tugging at its leash for a week, trying to rise. Well, today it succeeded. Gold cleared its 50 DMA ($1,188.45) & jumped clean over $1,200 and old resistance. In fact, its 200 DMA is at $1,220.71. Whoa. If gold can clear that mark, it will draw buyers like blood draws sharks. However, gold is trading in a very tight Bollinger Band width & today took it nearly to its 3-standard deviation upper line. Now remember, nothing says that band can't widen out, and they've been trading at their narrowest since June a year ago so they're ready to spread.

Whoa. Whoa! Silver closed above its 200 DMA (1714c). Cut clean through that old neckline resistance and 1660. Needs only top 1740, the last high. Gold needs to beat $1,225.

Something's stirring: interest rates are climbing fast, dollar's stumbling, stocks are frozen, and silver & gold burst upward. Something's going on we aren't seeing, something behind the scenes. Nice Government Men won't be able to sleep tonight for planning tomorrow's manipulations.

As I told y'all, I already bought silver & gold yesterday, but if they clear 1740c and $1,225 tomorrow, y'all had better buy some, too.

I looked at my daughter-in-law's iPhone yesterday and it showed every store she had visited since mid-March. Unless y'all want your phone tailing your and tattlin', go to Settings>accessibility>restrictions> location services> system services> frequent locations and turn the monster OFF.

On 13 May 1607 John Smith's group of English colonists landed near the James River in Virginia. Y'all might exercise your mathematical skills & discover that Virginia was settled thirteen years BEFORE Plymouth, Massachusetts. First English colony? In the South.

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
13-May-15 Price Change % Change
Gold, $/oz 1,218.40 25.80 2.16%
Silver, $/oz 17.21 0.70 4.22%
Gold/Silver Ratio 70.808 -1.427 -1.97%
Silver/Gold Ratio 0.0141 0.0003 2.01%
Platinum 1,149.80 17.40 1.54%
Palladium 789.40 4.25 0.54%
S&P 500 2,098.48 -0.64 -0.03%
Dow 18,060.49 -7.74 -0.04%
Dow in GOLD $s 306.42 -6.76 -2.16%
Dow in GOLD oz 14.82 -0.33 -2.16%
Dow in SILVER oz 1,049.60 -44.78 -4.09%
US Dollar Index 93.76 -0.85 -0.90%
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: 1,214.20      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,244.56 1,256.70 1,256.70
1/2 AE 0.50 618.73 640.49 1,280.98
1/4 AE 0.25 312.40 326.32 1,305.27
1/10 AE 0.10 127.39 132.95 1,329.55
Aust. 100 corona 0.98 1,183.02 1,192.02 1,216.10
British sovereign 0.24 287.97 300.97 1,278.53
French 20 franc 0.19 228.39 232.39 1,244.73
Krugerrand 1.00 1,227.56 1,237.56 1,237.56
Maple Leaf 1.00 1,222.20 1,238.20 1,238.20
1/2 Maple Leaf 0.50 698.17 637.46 1,274.91
1/4 Maple Leaf 0.25 309.62 324.80 1,299.19
1/10 Maple Leaf 0.10 128.71 132.35 1,323.48
Mexican 50 peso 1.21 1,453.59 1,464.59 1,214.72
.9999 bar 1.00 1,218.45 1,226.20 1,226.20
SPOT SILVER: 17.11      
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 12,805.65 13,163.15 18.41
US 40% silver 1/2s 0.30 4,855.70 5,005.70 16.97
100 oz .999 bar 100.00 1,701.00 1,751.00 17.51
10 oz .999 bar 10.00 170.10 175.60 17.56
1 oz .999 round 1.00 17.21 17.71 17.71
Am Eagle, 200 oz Min 1.00 18.61 19.46 19.46
SPOT PLATINUM: 1,149.80      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,164.80 1,194.80 1,194.80
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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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