The Moneychanger
Daily Commentary
Thursday, 5 October a.d. 2017 Browse the commentary archive

Stocks jes' keep risin' and risin', like Martha White Self-Risin' flour.

Dow rose for the seventh straight day, S&P500 rose for the eighth straight day and today made its sixth straight record close. Volatility index closed at 9.19, lowest point ever. In other words, at the point of historically unparalleled complacency.

Dow Industrials rose 11375 (0.5%) to 22,775.39, apparently on the way to 23,000. S&P500 climbed 14.33 (0.56%) to 2,552.07.

Just as a terminally ill patient seems recovering just before he expires, so topping markets appear strongest as they top. Here's a little meditation for y'all.

Gold's chart from 1 July 2011 through 15 September 2015 shows its double top, with the first top analogous (I suspect) to stocks today. Behold, http://schrts.co/fxnNDQ Ponder: The grotesquely overbought RSI indicator up top; the six days running gain leading into the top; the steep rate of ascent; the overbought MACD indicator, and finally, the speed and viciousness with which it broke, down 11% in 3 days before it rallied into that second top. At least the volume on this rise was increasing with the rise, unlike stocks today.

Six day winning streaks are six-sigma events -- rare & unlikely to persist.

Just for smiles, now compare the Dow Industrials chart, http://schrts.co/6i3CYC

Mark the sharp ascent and long upstreak; the overbought RSI & MACD, and Whoops! the Declining volume while the price riseth. Ooooo.

Now view the S&P500 chart at http://schrts.co/utjDur

There appeareth the overbought RSI, the long winning streak with sharp ascent, the overbought MACD and WHOOPS AGAIN! The flat volume not following price higher, indicating fewer & fewer buyers.

Me being a nat'ral born durn fool from Tennessee, I might be comparing kumquats & persimmons, but then again, maybe I ain't. Maybe I'm right. . . . That'd be a six-sigma event for shur!

US dollar index keeps rising, or rising by fits and starts, http://schrts.co/OkJ5UT Today it rose 50 basis points (0.54%) to 93.78, highest close yet for this move, but before it standeth yet resistance at 94 & higher. Interest rates are still rising. 10 year Treasury note yield today pierced its 200 DMA and has long ago broken out skyward.

One little hint that silver & gold may have nearly exhausted their downward momentum is that they are barely falling day by day and even disagreeing with each other. Yes, I know this sounds like, "Well, for a dead man he shur don't stink much." Sorry, I'm laboring hard.

Comex gold leapt, vaulted, jumped 1.9¢, almost two red pennies, to 1658.2¢. Gold lost $3.80 (0.3%) to $1,269.90.

'Pears to me that Gold is finding support as it draws nigh to $1,265 and becomes more & more reluctant to fall. Volume is also slowing. Looky here, http://schrts.co/aPwYUW Tain't yet precisely oversold on the RSI (i.e., below 30), but it's close enough to fog the windows.

Y'all hang on. This silver & gold suffering oughtn't last longer than next Friday.

Some sins are their own punishment, like shopping at WalMart. I know better, & today I got my chance to repent.

I had bought a pair of reading glasses for $26 at WalMart. I purposely bought the most expensive ones, Foster Grant, but three weeks didn't pass and the temple piece broke. I took 'em with me to WalMart customer "service."

Where one Beleaguered Woman was besieged by a line of four shoppers, none of 'em in a hurry. I ran off to grab some vinegar in the store, and when I came back there were still four shoppers in front of me. I toughed it out, got to the head of the line, explained my problem, & the Beleaguered Lady said, "Go get another pair and bring 'em back & you can swap them out."

I left my gallon of vinegar in her tender care and went searching for the reading glass display. Found it, but the most expensive pair cost only $16.98. I don't care, I thought, just grab a pair.

I returned to the customer "service" to find the beleaguered lady vanished. In her place was a man, who, despite all my compelling, cogent, well-marshaled and polite arguments, would NOT let me take the cheaper pair of readers to replace the broken pair. "Can't do it," he said, "Has to be exactly the same."

In a remarkable display of divine intervention, I did not unleash a string of cuss words but thanked him and walked out, taking my licks.

I got about three quarters of a mile away when I remembered I had left my gallon of vinegar at customer service. At that point I really did nearly cry.

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-Oct-17 Price Change % Change
Gold, $/oz 1,269.90 -3.80 -0.30%
Silver, $/oz 16.58 0.02 0.11%
Gold/Silver Ratio 76.583 -0.317 -0.41%
Silver/Gold Ratio 0.0131 0.0001 0.41%
Platinum 914.20 3.60 0.40%
Palladium 920.75 16.85 1.86%
S&P 500 2,552.07 14.33 0.56%
Dow 22,775.39 113.75 0.50%
Dow in GOLD $s 370.74 2.95 0.80%
Dow in GOLD oz 17.93 0.14 0.80%
Dow in SILVER oz 1,373.50 5.29 0.39%
US Dollar Index 93.78 0.50 0.54%
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: 1,267.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,287.58 1,297.58 1,297.58
1/2 AE 0.50 639.48 651.23 1,302.46
1/4 AE 0.25 322.91 329.56 1,318.23
1/10 AE 0.10 130.43 134.43 1,344.29
Aust. 100 corona 0.98 1,229.79 1,242.21 1,267.30
British sovereign 0.24 296.38 301.88 1,282.43
French 20 franc 0.19 234.24 239.24 1,281.41
Krugerrand 1.00 1,277.30 1,285.30 1,285.30
Maple Leaf 1.00 1,267.30 1,277.30 1,277.30
1/2 Maple Leaf 0.50 643.15 655.55 1,311.11
1/4 Maple Leaf 0.25 322.91 329.56 1,318.23
1/10 Maple Leaf 0.10 130.85 135.20 1,351.99
Mexican 50 peso 1.21 1,512.70 1,523.70 1,263.75
.9999 bar 1.00 1,269.30 1,281.30 1,281.30
SPOT SILVER: 16.56      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 21.00 24.00 31.37
VG+ Peace dollar 0.77 14.50 17.50 22.88
90% silver coin bags 0.72 11,515.08 11,801.08 16.51
US 40% silver 1/2s 0.30 4,706.73 4,854.73 16.46
100 oz .999 bar 100.00 1,630.50 1,683.50 16.84
10 oz .999 bar 10.00 164.05 169.05 16.91
1 oz .999 round 1.00 16.51 17.06 17.06
Am Eagle, 200 oz Min 1.00 18.11 18.51 18.51
SPOT PLATINUM: 914.20      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 912.20 959.20 959.20
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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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