The Moneychanger
Daily Commentary
Wednesday, 4 January a.d. 2017 Browse the commentary archive

Whoops. Trump has been looking and a-lookin', but can't seem to find anybody but Wall Streeters, mostly from Goldman Sachs, to man the financial wing of his administration. Well, mercy. Poor man. What's that them Frenchies say? "Plus ça change, plus c'est la même chose," whatever that means.

US dollar index stumbled today, again, from the top boundary of what increasingly looks like a broadening or megaphone top. Fell a meaty 63 basis points (0.61%) to close below 103 at 102.57. Hovering jes' above the 20 day moving average, first trigger of a decline. Needs a close below 101.5 to accelerate its fall. Chart's here,

Stocks show a megaphone, too. Look at the S&P500,

Yes, yes, stocks did rise today: Dow up 60.4 (0.3%) to 19,942.16 & the S&P500 up 12.95 (0.57%) to 2,270.75. But that's what broadening tops do, they trade to the upper boundary making higher highs or a flat top, & down to the lower boundary making lower lows. They work back & forth first exhilarating you, then casting you down, so you have to be patient even if it makes your scalp explode.

Notice the MACD & RSI on that chart. Both are headed down.

Lo, gold & silver added another day to their 2017 winning streak. On Comex gold rose $3.40 (0.3%) to $1,163.80, a new high since the 15 December 2016 low at $1,124.30. Silver rose a respectable 14.3¢ (0.9%) to 1649.9¢ -- also a new high from the 20 December 2016 low at 1568¢.

From $1,170 to $1,180 gold faces more resistance before it can challenge the bowl lip at $1,205. Yet gold stands above its 20 DMA, so it's making progress. Other indicators point up, volume is rising. Look at

Silver will simply have to slug it out all the way to the (assumed) neckline at 1725¢. Chart shows 2/3 completed upside down head and shoulders,

Knowing what little bit I know now, I'm looking for silver & gold prices to march higher into January.

On 4 January 1581 was born James Ussher, later Archbishop of the Anglican Church in Ireland. Best know for his calculation that the earth was created about 6:00 p.m. on 22 October 4004 BC, the ignorant also lampoon him for that pronouncement. However, Ussher was an extremely erudite polyglot who brought his vast learning outside the Bible as well as inside to bear on the question. It was a question physicist Isaac Newton also sought to answer. Jewish communities still use this "year of the world", anno mundi, for dating, but according to that dating it is presently year 5777, putting Creation in year 3761 BC, 243 years after Ussher's date.

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
4-Jan-17 Price Change % Change
Gold, $/oz 1,163.80 3.40 0.29%
Silver, $/oz 16.50 0.14 0.87%
Gold/Silver Ratio 70.538 -0.409 -0.58%
Silver/Gold Ratio 0.0142 0.0001 0.58%
Platinum 943.30 4.00 0.43%
Palladium 738.20 28.90 4.07%
S&P 500 2,270.75 1.29 0.06%
Dow 19,942.16 60.40 0.30%
Dow in GOLD $s 354.22 0.04 0.01%
Dow in GOLD oz 17.14 0.00 0.01%
Dow in SILVER oz 1,208.69 -6.87 -0.57%
US Dollar Index 102.57 -0.63 -0.61%
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: 1,162.70      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,197.58 1,201.65 1,201.65
1/2 AE 0.50 602.63 613.32 1,226.65
1/4 AE 0.25 307.12 312.48 1,249.90
1/10 AE 0.10 126.33 127.32 1,273.16
Aust. 100 corona 0.98 1,133.98 1,142.98 1,166.07
British sovereign 0.24 275.75 288.75 1,226.65
French 20 franc 0.19 217.08 223.08 1,194.84
Krugerrand 1.00 1,177.82 1,187.82 1,187.82
Maple Leaf 1.00 1,172.70 1,186.70 1,186.70
1/2 Maple Leaf 0.50 668.55 610.42 1,220.84
1/4 Maple Leaf 0.25 296.49 311.02 1,244.09
1/10 Maple Leaf 0.10 123.25 126.73 1,267.34
Mexican 50 peso 1.21 1,393.34 1,404.34 1,164.75
.9999 bar 1.00 1,167.35 1,172.70 1,172.70
SPOT SILVER: 16.43      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 27.00 35.29
VG+ Peace dollar 0.77 17.00 20.00 26.14
90% silver coin bags 0.72 11,958.38 12,244.38 17.13
US 40% silver 1/2s 0.30 4,653.63 4,803.63 16.28
100 oz .999 bar 100.00 1,632.50 1,657.50 16.58
10 oz .999 bar 10.00 165.75 170.75 17.08
1 oz .999 round 1.00 16.68 16.98 16.98
Am Eagle, 200 oz Min 1.00 17.93 19.43 19.43
SPOT PLATINUM: 943.30      
Plat. Platypus 1.00 958.30 988.30 988.30
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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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