The Moneychanger
Daily Commentary
Thursday, 20 April a.d. 2017 Browse the commentary archive

Good thing about markets is that even if you're right for a while, within 24 hours a market can turn around & stuff it right up your nose. Marvelously effective at cultivating humility.

Stocks tried to reverse upward today & made a fairly convincing show thereof. S&P500, chart here nearly touched its downtrend line, & pierced & left behind its 20 day moving average and sliced into & closed nigh on top of its 50 DMA (2,358). S&P500 added 17.67 (0.76%) to end at 2,355.54. Dow Industrials grew 174.22 (0.85%) for a close at 20,578.71.

Behold, the possibility we may see yet one last surge to new & ever more ridiculously over valued highs. However, a Dow close below 20,000 would kill that possibility. I am indifferent as the whole stock market is too ga-ga for me to buy. Stocks like Tesla & Netflix & Facebook are simply preposterous. But y'all go ahead -- y'all can have my share of them stocks.

One very accurate technical analyst I read -- yes, I check other people's work -- noted that a bullish pennant may be forming in the US dollar index. A bullish pennant is a pennant that points DOWN, like a falling wedge, with the same upside implications. If that is a bullish pennant & the dollar index doesn't negate it by closing below 98, then the dollar index might rise as high as 110. Think World War III.

Dollar index today didn't particularly inspire, rising only 5 basis points to 98.68. Yet the five day chart shows a double bottom today. Trading above 99.80 should carry it over 100.

Market is losing confidence in the Fed raising interest rates as much as they have threatened. I wouldn't have the Fed president job if they paid me a million dollars, carfare, and gave me immunity from listening to Donald Trump. Interest rates looked like they had broken down, as represented by the 10 year Treasury Note yield, seen ry-chere, but they caught at support a few days ago & remain broken out ABOVE the downtrend line from 2007. US 30 year bond (price runs opposite to interest rate) had broken out upside through the downtrend line from last July, seen here, but that chart don't inspire me to buy no bonds. Still hasn't cleared the 200 DMA after trying since last October.

Gold/silver ratio is a mess. Behold it's picture here,

Last couple of days trading has moved it higher and it remains above the 200 DMA. Ratio usually moves the opposite direction to metals.

Silver today stumbled 14.4¢ or 0.8% to close ignominiously below 1800¢ at 1799.2¢. Gold climbed a measly 50¢ to $1,281.90.

Silver's five day chart shows a five day decline with a sharp V-bottom today. Maybe today's low at 1788.5¢ marked the limit of the fall? It did hit the 50 DMA, which often contains corrections in a rallying market.

Speaking of rallying markets I may have been too hard on silver & gold yesterday. Last correction stopped at the 50 DMA, one before that stopped a little below it, and the one before that in January stopped plumb at it. Go look, That implies that silver above 1850¢ will run like a scalded dog.

Gold spot may have seen a low yesterday at $1,276, but it better not break that. Still, it's likely too hopeful to think a correction would pass after only a few days. What bothers me more than anything else are those falling gold coin premiums. Retail market is flooded with product. Very unusual, but offering good buys. 90% silver coin today at wholesale costs 10¢ an ounce under spot. Premiums on gold American Eagles and Buffalos in the last two weeks have dropped a full percentage point.

In 2008 or 2009 my friend Catherine Austin Fitts came to visit with a present: a six month old pit bull pup. She felt sorry for her because in the county where she lives the authorities kill all pit bulls, a ridiculous practice, so she kindly gave her to us.

I thought that dog, Bridget, would kill Susan, not from attacking her -- she's gentle as a dove -- but from chewing up every flower pot, tool, and object she could find on our porch or in our yard. Susan would plant something in a pot, and Bridget would eat the pot.

We keep her on an invisible fence cause she's not well-travelled enough to find her way home. Worse yet, she's storm-scaredy. Let the barometer drop & she's scratching the wood off the front door. If the storm's bad enough she runs to the upstairs bathroom and lies in front of the shower. I reckon that counts as safety if you're a dog.

About a year ago we were leaving home and that morning her invisible fence went down. Last thing I saw of her was a tail chasing through the woods. We had to leave, but that night came a huge storm which must have sent her running. She turned up about a week later several miles away and Susan was grieving the whole time she was gone. All this time I thought she just tolerated that dog.

I went to Chattanooga Monday night and a storm hit. Apparently that invisible fence is down again (yes, I recently changed her collar batteries) & Bridget took off running. I've driven around looking for her without success. I am shameless enough to impose on y'all's good nature yet again by asking y'all to pray for her return. She just gets so disoriented when she's out of her own place.

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
20-Apr-17 Price Change % Change
Gold, $/oz 1,281.90 0.50 0.04%
Silver, $/oz 17.99 -0.14 -0.79%
Gold/Silver Ratio 71.248 0.593 0.84%
Silver/Gold Ratio 0.0140 -0.0001 -0.83%
Platinum 978.00 10.50 1.09%
Palladium 802.75 27.30 3.52%
S&P 500 2,355.54 -12.65 -0.53%
Dow 20,578.72 174.22 0.85%
Dow in GOLD $s 331.85 2.68 0.81%
Dow in GOLD oz 16.05 0.13 0.81%
Dow in SILVER oz 1,143.77 18.69 1.66%
US Dollar Index 99.68 0.05 0.05%
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: 1,281.70      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,300.93 1,310.93 1,310.93
1/2 AE 0.50 653.16 676.10 1,352.19
1/4 AE 0.25 329.78 343.82 1,375.26
1/10 AE 0.10 131.91 140.09 1,400.90
Aust. 100 corona 0.98 1,245.02 1,254.02 1,279.35
British sovereign 0.24 303.98 316.98 1,346.54
French 20 franc 0.19 239.29 245.29 1,313.84
Krugerrand 1.00 1,290.67 1,300.67 1,300.67
Maple Leaf 1.00 1,291.70 1,304.70 1,304.70
1/2 Maple Leaf 0.50 736.98 672.89 1,345.79
1/4 Maple Leaf 0.25 326.83 342.85 1,371.42
1/10 Maple Leaf 0.10 135.86 139.71 1,397.05
Mexican 50 peso 1.21 1,531.31 1,542.31 1,279.18
.9999 bar 1.00 1,281.70 1,293.70 1,293.70
SPOT SILVER: 17.98      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.50 25.25 33.01
VG+ Peace dollar 0.77 15.50 18.00 23.53
90% silver coin bags 0.72 12,426.70 12,784.20 17.88
US 40% silver 1/2s 0.30 5,112.35 5,262.35 17.84
100 oz .999 bar 100.00 1,788.00 1,813.00 18.13
10 oz .999 bar 10.00 181.30 186.30 18.63
1 oz .999 round 1.00 18.23 18.53 18.53
Am Eagle, 200 oz Min 1.00 19.48 20.13 20.13
SPOT PLATINUM: 978.00      
Plat. Platypus 1.00 973.00 1,018.00 1,018.00
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© 2015 Little Mountain Corporation, d.b.a. The Moneychanger. All rights reserved. May not be republished in any form, including electronically, without our express permission.

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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