The Moneychanger
Daily Commentary
Monday, 5 December a.d. 2016 Browse the commentary archive

Weekend brought one score FOR the Worldwide Revulsion, and one AGAINST. Italian voters turned down Establishment politician Matteo Renzi's constitutional makeover but in Austria voters elected a center-left (read: communist with one leg shorter than the other)) candidate over the anti-immigration Freedom Party candidate.

Take away? The previously unbeatable Establishment lost.

In Europe it was a day of proving out "sell the rumor, buy the news" as somebody bought the euro, which rose 0.93% to $1.0764. Yen fell, though, 0.23% to 87.91. US dollar reeled back from a strong blow, losing 70 basis points (0.69%) to 100.17. Chart's here, and says it all,

Today when the dollar cracked 101, it sank plumb through the 20 DMA. A little internal support lies at the old channel line, now about 99.75, but the gaps between support below that are large. I am not saying the dollar's intermediate rally is broken because there's not enough evidence yet. This is only a correction of the Trump rally. Have to watch to see the outcome.

Dow Industrials made another new high today at 19,216.24, up 45.82 (0.24%). S&P500 rose even more, 0.58%, but didn't nearabout make a new high. Ended up 12.76 at 2,204.71.

I don't mind putting my hand over my mouth and admitting I have no clue what is going on, other than rabid old bull enthusiasm.

Friday both silver & gold rose well, gold up 0.7% ($8.20) & silver higher by 2% (32.6¢). A couple of facts are gainsaying further big losses in metals.

First, gold has had abundant opportunities to crash further, but refused the fun. Overnight it fell to $1,156.10, but bounced back as high as $1,187.70. Finished Comex at $1,174.00, down $1.10. Silver scraped bottom at 1647¢ but rebounded to 1697.5¢ and closed Comex up 7.1¢ at 1682.4¢. Look at the gold chart,

RSI remains oversold, while the MACD is threatening to turn up. It's positive that it won't break lower than $1,160, but positive don't butter no biscuits. Still needs to climb over $1,200.

Silver's chart, on the other hand, looks different,

The Relative Strength Index has never reached the gold's oversoldness during this correction, but the MACD has already turned up, as has the rate of change. More, silver has held on and continued to gain, forming a rounding bottom pattern. Today it nearly touched the 20 day moving average overhead. A close above 1700¢ would start building my confidence, & a close above 1725¢ would makeit a raging bonfire.

So silver keeps on gainsaying gold's lower ranges by steadily rising. That contradiction works in the metals' favor.

We all had a rollickin' good time with the Smiths in Erin, but Jim wasn't at all happy with the bratwurst we made. Too crumbly, cause it needed about half again as much pork fat our recipe called for. And although I have enthusiastically eaten bratwurst on two continents, I never realized they were made out of pork AND beef.

The sourdough bread worked like a champ, too. We had to leave Saturday before it was baked, but Pam sent us pictures that made me drool. I am gluten intolerant but can eat a limited amount of sourdough bread, made from organic wheat, with no ill effects at all. That's why Susan was learning to make it: for me, bless her heart.

I'm just not mean enough to tell y'all more about the lamb roast Jim cooked to pink perfection over lump charcoal on his Big Green Egg. I'd be tempting y'all to envy. And then there were Pam's pan fried green beans. Naw, I'm not saying another word.

Argentum et aurum comparanda sunt —
Silver and gold must be bought.

— Franklin Sanders, The Moneychanger

Your source for gold and silver. Read our latest reviews and testimonials.
Market Snapshot See more charts and market data
5-Dec-16 Price Change % Change
Gold, $/oz 1,174.00 -1.10 -0.09%
Silver, $/oz 16.82 0.07 0.42%
Gold/Silver Ratio 69.781 -0.361 -0.52%
Silver/Gold Ratio 0.0143 0.0001 0.52%
Platinum 937.00 6.00 0.64%
Palladium 745.95 1.15 0.15%
S&P 500 2,204.71 12.76 0.58%
Dow 19,216.24 45.82 0.24%
Dow in GOLD $s 338.36 1.12 0.33%
Dow in GOLD oz 16.37 0.05 0.33%
Dow in SILVER oz 1,142.19 -2.11 -0.18%
US Dollar Index 100.17 -0.70 -0.69%
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: 1,171.10      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,207.40 1,210.33 1,210.33
1/2 AE 0.50 596.75 617.76 1,235.51
1/4 AE 0.25 301.30 314.73 1,258.93
1/10 AE 0.10 122.86 128.24 1,282.35
Aust. 100 corona 0.98 1,142.17 1,151.17 1,174.43
British sovereign 0.24 277.74 290.74 1,235.11
French 20 franc 0.19 216.46 220.46 1,180.81
Krugerrand 1.00 1,188.67 1,198.67 1,198.67
Maple Leaf 1.00 1,181.10 1,195.10 1,195.10
1/2 Maple Leaf 0.50 673.38 614.83 1,229.66
1/4 Maple Leaf 0.25 298.63 313.27 1,253.08
1/10 Maple Leaf 0.10 124.14 127.65 1,276.50
Mexican 50 peso 1.21 1,404.82 1,415.82 1,174.27
.9999 bar 1.00 1,175.20 1,183.10 1,183.10
SPOT SILVER: 16.74      
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 12,576.85 12,862.85 17.99
US 40% silver 1/2s 0.30 4,746.55 4,896.55 16.60
100 oz .999 bar 100.00 1,654.00 1,689.00 16.89
10 oz .999 bar 10.00 168.90 173.90 17.39
1 oz .999 round 1.00 16.54 17.04 17.04
Am Eagle, 200 oz Min 1.00 18.24 19.74 19.74
SPOT PLATINUM: 937.00      
Plat. Platypus 1.00 952.00 982.00 982.00
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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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