The Moneychanger
Daily Commentary
Wednesday, 19 August a.d. 2015 Browse the commentary archive

Well, I called that one wrong. Silver & gold bounced up. Maybe I get some credit because the FOMC minutes scrambled everybody's eggs.

FOMC meetings were published and they said yes, they would definitely possibly maybe raise interest rates in September perhaps if employment remains employed and the moon signs are just right. Sounded like Alan Greenspan in one of his senior moments.

I'm not even gonna try to figure out what it means & by what track of logic folks bought or sold, but stocks took it hard, I'll tell you. Stocks were puking sick when the day began, down 150 within minutes of the open, sinking further, then trying to rally when the FOMC minutes were published, but crashing right back. Dow gave up 162.61 (0.93%) to 17,348.73, wiping out any gains from the last week. S&P500 lost 17.31 (0.83%) to 2079.61.

Dow is back beneath an internal resistance/support line I've been watching, below its 200, 50, and 20 DMA (in that order, i.e., pointing down). S&P500 is about 2 points above its 200 DMA. Sick.

I reckon that US dollar index had been kept a-floatin' by all them folks fading the Fed, buying dollars expecting the Fed to announce an interest rate increase in September. I reckon they got their wings & toenails clipped today, & serves 'em right -- anybody foolish enough to count on something a central banker says. It's a fool looks for consistency in the heart of a central banker.

Dollar index lost 65 basis points (0.67%) to 96.42, below its 20 & now its 50 day moving averages, & within spitting distance of the last low at 95.95. Wouldn't take much to send it tumbling. Euro, on the other hand, gained 0.83% to $1.1120 & jumped over that downtrend line and its 20 & 50 DMAs. Crazy thing's liable to rally. Yen added 0.39% to 80.71, which takes it, too, above its downtrend line.

Gold jumped $11 (1%) to $1,128.10. Silver leapt 33.9 cents (2.6%) to 1517.6c.

Today's close marked a new high for the move & convincingly suggest that gold has stepped out on another leg of its rally. Silver did not make a new high, but regained all of yesterday's losses. Parked on its 50 DMA. Aftermarket was higher for silver, up to 1535c & for gold, $1,134.50. Strong as a garlic milkshake.

More strength confirmation came from Platinum, up $19 to $1,011.90 & palladium, up $12.85 to $609.35.

I would feel more comfortable if silver also had closed at a new high. I would also be less likely to look for one more downmove. If tomorrow gold opens higher and silver does, too, then they're off to the races. I still want to witness silver above 1560c.

On 19 August 1939 the film The Wizard of Oz opened in New York.

Man can't beat them Clintons for almighty gall. Hillary turned over her email server to congress -- erased.

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
19-Aug-15 Price Change % Change
Gold, $/oz 1,128.10 11.00 0.98%
Silver, $/oz 15.18 0.39 2.63%
Gold/Silver Ratio 74.334 -1.212 -1.60%
Silver/Gold Ratio 0.0135 0.0002 1.63%
Platinum 1,011.90 19.00 1.91%
Palladium 609.35 12.85 2.15%
S&P 500 2,079.61 -17.31 -0.83%
Dow 17,348.73 -162.61 -0.93%
Dow in GOLD $s 317.91 -6.14 -1.89%
Dow in GOLD oz 15.38 -0.30 -1.89%
Dow in SILVER oz 1,143.17 -41.07 -3.47%
US Dollar Index 96.42 -0.65 -0.67%
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: 1,134.50      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,169.67 1,174.21 1,174.21
1/2 AE 0.50 578.09 598.45 1,196.90
1/4 AE 0.25 291.88 304.90 1,219.59
1/10 AE 0.10 119.02 124.23 1,242.28
Aust. 100 corona 0.98 1,103.14 1,112.14 1,134.61
British sovereign 0.24 269.06 282.06 1,198.23
French 20 franc 0.19 213.40 217.40 1,164.43
Krugerrand 1.00 1,152.65 1,162.65 1,162.65
Maple Leaf 1.00 1,144.50 1,158.50 1,158.50
1/2 Maple Leaf 0.50 652.34 595.61 1,191.23
1/4 Maple Leaf 0.25 289.30 303.48 1,213.92
1/10 Maple Leaf 0.10 120.26 123.66 1,236.61
Mexican 50 peso 1.21 1,360.91 1,371.91 1,137.86
.9999 bar 1.00 1,138.47 1,146.50 1,146.50
SPOT SILVER: 15.35      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 25.00 27.00 35.29
VG+ Peace dollar 0.77 20.00 22.00 28.76
90% silver coin bags 0.72 13,263.25 13,620.75 19.05
US 40% silver 1/2s 0.30 4,336.50 4,486.50 15.21
100 oz .999 bar 100.00 1,560.00 1,585.00 15.85
10 oz .999 bar 10.00 155.00 160.00 16.00
1 oz .999 round 1.00 15.45 15.91 15.91
Am Eagle, 200 oz Min 1.00 16.85 18.35 18.35
SPOT PLATINUM: 1,011.90      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,026.90 1,056.90 1,056.90
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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.
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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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