The Moneychanger
Daily Commentary
Thursday, 28 December a.d. 2017 Browse the commentary archive

I hope y'all had a blessed and joyous Christmas. Around here we celebrate Christmas for 12 days, from Christmas Eve through the Epiphany on January 6. Today we celebrate Holy Innocents, the babies slaughtered by the tyrant Herod, who by their deaths deceived and defeated Herod's attempt to kill the Christ child.

What a difference from a few days! Dollar is broken & teetering on the chasm's edge, Stocks are stalled, and silver & gold are SMOKIN'!

CME Bitcoin futures closed $13,795, down $945 or 6.4%. shows a current $14,119.36, down $1,258.93 or 8.19%. I have no idea who to believe, but I think Bitcoin has busted.

Behold, the scrofulous US dollar index, Mark that after failing to break through the downtrend line after it had completed a head & shoulders bottom, it collapsed down to the shoulder line. Traded back up to the downtrend line to try again, and again failed. Now it has fallen back to the shoulder line and today made a new low close below the line. Lost 48 basis points today to 92.34. If it falls through here it won't stop for a long ways. Might catch at the head, about 91, but below that awaits only air.

Look at the S&P500 chart, It has inched sideways to meet the uptrend line. Santy Claws done come and gone. What's gonna keep stocks flying now?

Dow today rose 63.21 (0.26%) to 24,837.51. S&P500 climbed 4.92 (0.18%) to 2,687.54.

Here's the Dow in Gold chart, go look: Since that 12 December high it has tumbled and fallen past the 20 DMA and now hit the uptrend line. Time to fish or cut bait.

Gold rose $10 (0.8%) on Comex to close at $1,294.10 & silver climbed a massy 35.2¢ or 2.14% to 1683.3¢. Last four days silver & gold have been on a tear.

Ponder gold first, Remember how it failed so often below $1,290? It has climbed up steadily off that 12 December bottom, risen through its moving averages, built volume, and now punched through $1,290 getting ready to smash $1,300. (Did he really say that? Yes, he said that, naked, no hedge at all.)

January will be good to gold.

Lo, the gold/silver ratio, Y'all feast your eyes on this chart. The ratio has tumbled from its early December high, nay, avalanched, through its 20 DMA and today gapped down and closed barely above its 50 DMA. Look at those red arrows: Every indicator is calling for a lower ratio, which means higher silver & gold prices..

Silver is a sight for sore eyes, Silver has climbed off that bottom to pierce its overhead 20 Day moving average, resistance about 1650¢, 50 DMA, & closeth in on its 200 DMA. May be some resistance from the apex of that earlier triangle, but volume is rising and al indicators enthusiastically signal higher prices.

January will be even better to silver.

Y'all listen now, hear my words, make 'em down: gold and silver bottoms are behind us. Gold is aiming for $1,350 resistance, and once it bursts through that, and some of the other bubbles around us burst, the rally will be long, tough, and fruitful.

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
28-Dec-17 Price Change % Change
Gold, $/oz 1,294.10 10.00 0.78%
Silver, $/oz 16.83 0.35 2.14%
Gold/Silver Ratio 76.883 -1.035 -1.33%
Silver/Gold Ratio 0.0130 0.0002 1.35%
Platinum 926.90 4.80 0.52%
Palladium 1,076.20 31.35 3.00%
S&P 500 2,687.54 4.92 0.18%
Dow 24,837.51 63.21 0.26%
Dow in GOLD $s 396.75 -2.07 -0.52%
Dow in GOLD oz 19.19 -0.10 -0.52%
Dow in SILVER oz 1,475.61 -27.68 -1.84%
US Dollar Index 92.34 -0.48 -0.52%
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: 1,294.10      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,312.22 1,337.45 1,337.45
1/2 AE 0.50 659.48 682.64 1,365.28
1/4 AE 0.25 332.97 347.79 1,391.16
1/10 AE 0.10 135.78 141.70 1,417.04
Aust. 100 corona 0.98 1,258.96 1,268.48 1,294.10
British sovereign 0.24 306.92 319.92 1,359.03
French 20 franc 0.19 239.19 243.19 1,302.58
Krugerrand 1.00 1,299.28 1,309.28 1,309.28
Maple Leaf 1.00 1,302.10 1,318.10 1,318.10
1/2 Maple Leaf 0.50 744.11 679.40 1,358.81
1/4 Maple Leaf 0.25 330.00 346.17 1,384.69
1/10 Maple Leaf 0.10 137.17 141.06 1,410.57
Mexican 50 peso 1.21 1,548.47 1,559.47 1,293.41
.9999 bar 1.00 1,289.10 1,307.10 1,307.10
SPOT SILVER: 16.86      
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 11,622.33 11,908.33 16.66
US 40% silver 1/2s 0.30 4,780.48 4,927.48 16.70
100 oz .999 bar 100.00 1,665.50 1,700.50 17.01
10 oz .999 bar 10.00 170.05 175.05 17.51
1 oz .999 round 1.00 16.66 17.26 17.26
Am Eagle, 200 oz Min 1.00 18.11 18.86 18.86
SPOT PLATINUM: 926.90      
Plat. Platypus 1.00 941.90 971.90 971.90
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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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