The Moneychanger
Daily Commentary
Monday, 19 October a.d. 2015 Browse the commentary archive

Sometimes the NGM's manipulation efforts are simply hilarious. Go to www.nasdaq.com and in that box on the left click on DJIA for the chart of the Dow. You will no doubt notice that it remained underwater -- lower than Friday -- the entire day until about ten minutes before the close. Now click on the S&P500. It did poke a nostril above unchanged about noon, but then dropped like a Jumbo Jet out of gas until a little before two, when help arrived. Still, by 4:00 p.m. it had only poked a little sliver above unchanged.

But lo, what mattereth such trifles? Important thing is the headline for the rubes, "Stocks up for the day!" I don't know about y'all, fellow mushrooms, but I'd prefer a higher quality hogwash, a lie that really might fool somebody. Corporate socialism is so sorry -- can't even produce a decent liar.

Stocks ROSE today. Dow perked up a mighty 14.57 (0.08%) just in time for the closing bell. S&P500 leapt, yea, leapt 0.55 (0.03%) to 2,033.66.

I wonder if it will get to the point where they don't even bother having markets any more, but just announce the price every day and applaud?

Y'all just think I'm grumpy & resentful, but that's not all the burr that's under my saddle. Markets are not merely a price-discovery mechanism, but also must be a value-discovery mechanism to serve the economy. Otherwise, they're just a liar's convention.

Dow in Gold rose 0.67% to 14.72 troy ounces & smacked into the 50 DMA, which not too long ago crossed beneath the 200 DMA (so-called "death cross", but that's another story). Will hit the downtrend line about 14.88. Remains in a down trend. Go look at http://schrts.co/8Sv0tc

Dow in Silver sits differently. 50 DMA is above the 200 DMA but closing in on it fast, while the 20 DMA is beneath the 200. Closed the day at 1,088.47 troy oz, still below that 200 DMA at 1,106.51 oz. View at http://schrts.co/ohwLZP

Why, y'all ask, does he keep harping on the Dow in Gold & the Dow in Silver? To filter out the noise. When I view the raw Dow alone or raw gold or silver, I don't see directly stocks' trend against metals, and THAT is what I want to know, to remain on the right side of that trend. THAT tells me how the future will unroll. And it says that stocks have turned DOWN against silver & gold, UNLESS the Dow in gold can rise above 16.50 oz, the summer's (and the recovery's) high and the Dow In Silver above 1,236.37 oz.

US DOLLAR INDEX rose today 37 basis points to 94.95, bumping against the downtrend line from 1 October. Given the dollar index' preceding lows, 92.52 in August & 94.19 in September, 15 October's low at 93.83 would be a logical place to turn around. Also, that day was the first half of a key reversal upwards, confirmed the next two days (including today). http://schrts.co/OkJ5UT

So even though it remains submerged far below its 200 DMA AND the 20, 50, & 200 DMAs are lined up bearishly, the scrofulus fiat scum is rallying.

That makes trouble for silver & gold. There's more bad news. The US Dollar has a habit (last five years) of making yearly lows in October's second half. Trouble comes immediately when the dollar breaches 95.57 upward.

Euro closed down 0.28% to $1.1326 and has burned up almost all its October gains. Yen has done the same, and closed today at 83.67, down 0.5%.

Gold backed down $10.30 to $1,173.30 on Comex, silver 27.3 cents to 1582.9c.

We're in the valley of decision here. Gold needs to remain above $1,163 & silver above 1560c for the rally to remain alive.

Both gold and silver closed below their 200 day moving averages today. Silver fell out of that rising wedge, bad juju. And the Gold/Silver Ratio jumped to 74.123, above its 200 DMA after spending all of October below it. Silver chart is here, http://schrts.co/kDgJdy and gold here, http://schrts.co/Cr8gni

Since August both metals have maintained a steady uptrend, bettering previous highs, but this uptrend is embedded in a four year downtrend. It must keep on rising to prove itself, or else it's no more than preparation for dashed hopes. And I have no crystal ball, no trend-sniffing dog, no clairvoyance to tell, I just have to sit and watch with y'all, occasionally dabbing the blood off my quick-bitten nails.

One of the best broad articles I have read on Global Warming/ Climate Change is found here on Thrive, http://bit.ly/1OBfIN3

Also don't miss "Who Turned the Stock Market Around at 4:47 a.m. This Morning?" at Wall Street on Parade, http://bit.ly/1OFa6S1 'Twill offer y'all a little insight into how the Nice Government Men goose the stock market. Or, if not NGM, somebody else. Point is, they buy S&P500 futures to force the S&P500 up by arbitrageurs.

In Venezuela where they have Lots & Lots of socialism where we have only Lots of socialism, the inflation by which they "pay" for socialism has forced Venezuelan money so low that it's now cheaper than napkins. http://bit.ly/1RSZWvF

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-Oct-15 Price Change % Change
Gold, $/oz 1,173.30 -10.30 -0.87%
Silver, $/oz 15.83 -0.27 -1.70%
Gold/Silver Ratio 74.123 0.617 0.84%
Silver/Gold Ratio 0.0135 -0.0001 -0.83%
Platinum 1,013.40 -7.90 -0.77%
Palladium 687.60 -11.30 -1.62%
S&P 500 2,033.60 0.55 0.03%
Dow 17,230.54 14.57 0.08%
Dow in GOLD $s 303.58 2.90 0.96%
Dow in GOLD oz 14.69 0.14 0.96%
Dow in SILVER oz 1,088.54 19.36 1.81%
US Dollar Index 94.95 0.37 0.39%
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: 1,171.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,201.10 1,212.81 1,212.81
1/2 AE 0.50 597.11 618.12 1,236.25
1/4 AE 0.25 301.48 314.92 1,259.69
1/10 AE 0.10 122.93 128.31 1,283.12
Aust. 100 corona 0.98 1,141.71 1,150.71 1,173.95
British sovereign 0.24 277.91 283.91 1,206.08
French 20 franc 0.19 220.42 224.42 1,202.01
Krugerrand 1.00 1,188.21 1,198.21 1,198.21
Maple Leaf 1.00 1,181.80 1,195.80 1,195.80
1/2 Maple Leaf 0.50 673.79 615.20 1,230.39
1/4 Maple Leaf 0.25 298.81 313.46 1,253.83
1/10 Maple Leaf 0.10 124.21 127.73 1,277.26
Mexican 50 peso 1.21 1,404.25 1,415.25 1,173.80
.9999 bar 1.00 1,175.90 1,183.80 1,183.80
SPOT SILVER: 15.80      
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 12,723.43 13,223.93 18.50
US 40% silver 1/2s 0.30 4,467.78 4,717.78 15.99
100 oz .999 bar 100.00 1,604.50 1,629.50 16.30
10 oz .999 bar 10.00 159.45 164.45 16.45
1 oz .999 round 1.00 15.90 16.36 16.36
Am Eagle, 200 oz Min 1.00 17.30 18.80 18.80
SPOT PLATINUM: 1,013.40      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,028.40 1,058.40 1,058.40
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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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