The Moneychanger
Daily Commentary
Wednesday, 15 November a.d. 2017 Browse the commentary archive

Meant to tell y'all yesterday about another one of those mysterious gold dumps. According to Bloomberg, somebody sold almost 40,000 contracts or nearly 4,000,000 oz of gold over a 10 minute span after 11:10 on Comex. Gold dropped from $1,284 to $1,275 in one minute.

That might dishearten some, but when you see a market hit with selling equal to 10% of the daily volume -- in minutes -- and falling only 0.8%, what does it tell you? That underneath $1,275 crowd buyers eager to buy at those prices. The raid revealed hidden strength, not weakness -- good news, not bad.

The European Central Bank is proposing to remove bank deposit insurance & solidify the "bail-in" method of dealing with insolvent banks, i.e., robbing the depositors before the taxpayers. If Europe goes that direction, can America be far behind? We have almost as many rotten banks as they do. Upshot is, you need some SAFE storage for your savings. Bail-ins -- taking depositors money for a failing bank -- haven't been done in the US Yet, but have in Europe. Handwriting is on the wall. Only safe way to store savings is physical gold or silver that you have in your own hot little hands. Longer article at

US dollar index has posted a Key Reversal downward on its weekly chart, That promises lower prices soon. Today the Dollar index dropped 3 basis points (0.03%) to 93.71. Euro didn't move much, down 0.06% to $1.1792, but the yen took the occasion to shoot up 0.52% to 88.61. Dollar has broken down, at least for a correction.

A couple of considerations about stocks. The Dow Industrials index, though not other indices, has posted a Key Reversal downward on the weekly chart, Key reversals confirmed, as this one is, usually do not lie. Note also the Volatility Index, Recently it has reached multi-decade lows, but in the last few days it has shot up to resistance and is about to break through skyward. Japanese Nikkei Stock index is also in trouble, with a top and Key Reversal, And the blue chip General Electric has been struggling all year and three days ago announced it was not paying a dividend. That was quite enough to pull the plug,

Today was a bad hair day for stocks. Dow fell 138.19 (0.59%) to 23,271.28. S&P500 subtracted 14.25 (0.55%) to end at 2,564.62.

S&P500 chart is here, The S&P has traced out and completed a rising wedge (green) since early 2016, then another rising wedge within that (purple). One more down day takes it out of that greater wedge & shooting toward the 50 DMA at 2,542.59.

Stocks are cracking.

Bitcoin today is at $7,237.59, up 9.68% since yesterday but down 6.28% from the 8 November high at $7,721.98.

I find myself in the unwelcome position of the little boy watching the emperor's parade. I look at the cryptocurrencies and all I can see is parabolic charts, which always indicate blow off buying manias, and never mind my other as yet unanswered questions about them. I look at stocks, levitated on waves of central bank money creation to higher and more unrealistic valuations, and I can only think "Classic debt bubble product." So here I am, ignorant nat'ral born durn fool from Tennessee watching the cryptocurrency and stock parades march by, and all I can say is, "They ain't got no durned clothes on!" But what do I know?

Meanwhile, back to the hibernating metals. Today they undid all they gained yesterday. Gold fell $5.00 (0.4%) to $1,276.50 while silver rocked back 10.2¢ (0.6%) to 1695¢. Sigh. Gold/silver ratio closed Comex at 75.310.

The one day chart shows that gold reached $1,290 by 11:00, then about 11:30 was hit by selling that left it gapping down to $1,277 in about an hour. Big seller?

We have now reached mid-November, by which time I expected the picture would have cleared and silver & gold would have resolved upwards to confirm a bottom. No such luck. Both remain rangebound. To prove a bottom is past, gold must close above $1,300, silver above 1725¢. Till then a chance remains open that both will yet spike a low.

Y'all just gnaw your nails and be patient. Seasonally silver & gold generally finish strong -- that's what the 30 year seasonal chart shows -- although they made lows in December 2015 and December 2016.

I ask myself if I would have married Susan and lived with her nearly 49 years if I had known how badly it would hurt losing her. I can only answer yes. Only way to avoid the pain of losing a beloved is never to love, which is truly never to live.

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
15-Nov-17 Price Change % Change
Gold, $/oz 1,276.50 -5.00 -0.39%
Silver, $/oz 16.95 -0.10 -0.60%
Gold/Silver Ratio 75.310 0.157 0.21%
Silver/Gold Ratio 0.0133 -0.0000 -0.21%
Platinum 929.90 5.80 0.63%
Palladium 986.50 -0.45 -0.05%
S&P 500 1,564.62 -14.25 -0.90%
Dow 23,271.57 -138.19 -0.59%
Dow in GOLD $s 376.86 -0.76 -0.20%
Dow in GOLD oz 18.23 -0.04 -0.20%
Dow in SILVER oz 1,372.95 0.11 0.01%
US Dollar Index 93.71 -0.03 -0.03%
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: 1,276.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,296.82 1,319.16 1,319.16
1/2 AE 0.50 650.45 673.30 1,346.60
1/4 AE 0.25 328.42 343.03 1,372.13
1/10 AE 0.10 133.92 139.77 1,397.66
Aust. 100 corona 0.98 1,238.62 1,251.13 1,276.40
British sovereign 0.24 302.72 315.72 1,341.20
French 20 franc 0.19 235.92 239.92 1,285.06
Krugerrand 1.00 1,281.51 1,291.51 1,291.51
Maple Leaf 1.00 1,284.40 1,300.40 1,300.40
1/2 Maple Leaf 0.50 733.93 670.11 1,340.22
1/4 Maple Leaf 0.25 325.48 341.44 1,365.75
1/10 Maple Leaf 0.10 135.30 139.13 1,391.28
Mexican 50 peso 1.21 1,523.44 1,534.44 1,272.65
.9999 bar 1.00 1,280.87 1,288.40 1,288.40
SPOT SILVER: 16.94      
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 11,679.53 11,965.53 16.74
US 40% silver 1/2s 0.30 4,804.08 4,954.08 16.79
100 oz .999 bar 100.00 1,673.50 1,708.50 17.09
10 oz .999 bar 10.00 170.85 175.85 17.59
1 oz .999 round 1.00 16.74 17.34 17.34
Am Eagle, 200 oz Min 1.00 18.44 19.94 19.94
SPOT PLATINUM: 929.90      
Plat. Platypus 1.00 944.90 974.90 974.90
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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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