The Moneychanger
Daily Commentary
Monday, 17 July a.d. 2017 Browse the commentary archive

Illustrating once again how inevitably fatal a parabolic rise is to any market, I notice that Bitcoin Friday fell to a low of $1,841, down 41% from its $3,108.5 high on June 11. Bitcoin, stock, gold, silver goats, fava beans, it makes no difference. Any parabolic rise is a screaming, flashing sign that a big fall is coming, followed by a long correction.

I want to get very serious with y'all for a moment. Silver & gold stand on an extraordinary buying point. If you are familiar with the 5 wave uptrend -- Wave 1 up, Wave 2 down, Wave 3 up, Wave 4 down, Wave 5 up -- this will make sense. The peak in July 2016 was the top of Wave 1, and the recent low was the bottom of wave 2, or that bottom might come shortly, slightly lower. Wave 3 up about to begin is often the most powerful. This will be the wave that challenges, perhaps conquers, gold's 2013 $1,550 breakdown point. It will vastly outperform the wave up from December 2015 to July 2016.

Nope, I haven't a clue what event will trigger it, but it should begin really climbing within the next two months.

Stocks today backpedalled after touching new all-time highs on Friday. Dow crawfished 8.02 (0.04%) to 21,629.72. S&P500 lost 0.13 (0.01%) to 2,459.14. None of this tells us whether stocks will move higher, but frankly they have very little upside room. Within those same couple of months that will witness silver & gold beginning an epochal rally, stocks will witness the floor collapse.

US dollar index was flat today at 95.13. Careful, that chart MIGHT be forming a falling wedge, which is a bullish sign. Wedges point the opposite way they resolve.

On Comex gold rose $6.20 (0.5%) to $1,232.80 while silver rose 16.6¢ (1.05%) to 1605¢. By the way, that's an example of what I mean when I say that silver usually outperforms gold in uptrends. Not every day, but generally. Falls faster, too.

Here is the silver chart,

Today's advance through 1600¢ resistance was workmanlike, steady. Reached up to touch the 20 day moving average, but didn't quite make it. Closed above the downtrend line from the 2011 high. MACD indicator turned up. The switches are all turned on, silver now needs only mash down that gas pedal.

Here is today's daily gold chart,

Gold continued the advance begun 10 July. Closed barely above the 20 & 200 day moving averages but barely is quite good enough for this purpose. Remains above the downtrend line. MACD indicator has turned up (fast moving black line punched through the slow moving red).

I just have one word for y'all: Do NOT despise the day of small things.

Now y'all please go back to the top and read my second paragraph. Silver & gold are fixin' to make a stunning rise. Now's the time to hop down off that fence and hop on.

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
17-Jul-17 Price Change % Change
Gold, $/oz 1,232.80 6.20 0.51%
Silver, $/oz 16.05 0.17 1.05%
Gold/Silver Ratio 76.810 -0.412 -0.53%
Silver/Gold Ratio 0.0130 0.0001 0.54%
Platinum 927.60 6.70 0.73%
Palladium 870.55 4.80 0.55%
S&P 500 2,459.14 -0.13 -0.01%
Dow 21,629.72 -8.02 -0.04%
Dow in GOLD $s 362.69 -1.97 -0.54%
Dow in GOLD oz 17.55 -0.10 -0.54%
Dow in SILVER oz 1,347.65 -14.59 -1.07%
US Dollar Index 95.13 -0.02 -0.02%
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: 1,234.35      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,254.10 1,275.70 1,275.70
1/2 AE 0.50 648.13 638.78 1,277.55
1/4 AE 0.25 317.59 327.10 1,308.41
1/10 AE 0.10 130.74 133.93 1,339.27
Aust. 100 corona 0.98 1,199.02 1,208.02 1,232.42
British sovereign 0.24 292.75 305.75 1,298.83
French 20 franc 0.19 228.15 232.15 1,243.43
Krugerrand 1.00 1,242.99 1,252.99 1,252.99
Maple Leaf 1.00 1,240.52 1,250.52 1,250.52
1/2 Maple Leaf 0.50 709.75 648.03 1,296.07
1/4 Maple Leaf 0.25 314.76 330.19 1,320.75
1/10 Maple Leaf 0.10 130.84 134.54 1,345.44
Mexican 50 peso 1.21 1,474.74 1,485.74 1,232.26
.9999 bar 1.00 1,236.35 1,244.35 1,244.35
SPOT SILVER: 16.13      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.50 25.50 33.33
VG+ Peace dollar 0.77 15.00 18.00 23.53
90% silver coin bags 0.72 11,282.70 11,568.70 16.18
US 40% silver 1/2s 0.30 4,581.35 4,729.35 16.03
100 oz .999 bar 100.00 1,563.00 1,638.00 16.38
10 oz .999 bar 10.00 160.30 163.80 16.38
1 oz .999 round 1.00 16.08 16.48 16.48
Am Eagle, 200 oz Min 1.00 16.88 18.18 18.18
SPOT PLATINUM: 927.60      
Plat. Platypus 1.00 942.60 972.60 972.60
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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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