Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Analysis of the Seasonal Variations in the Price of Gold

Commodities / Gold & Silver Jun 20, 2007 - 06:10 PM GMT

By: Michael_J_Kosares

Commodities

Bargain Buying: Use Seasonal Price Trends to Your Advantage USAGOLD-Centennial Precious Metals

One of the more intriguing curiosities of the current bull market in gold has to do with the annual buying opportunity which seems to crop up in the depths of the summer doldrums.


summer doldrum gold pricesTo make a long story short, gold purchases made in June and July proved very profitable by year-end, as shown in the annual price charts (see right) and explained by our following evaluation.

As depicted in the graph below, the end of a 20-yr bear market in gold was marked in 1999, and this new bull market birthed in 2001.

20-yr price chart


20 Year Gold Price Chart; Secular Bear Becomes Secular Bull

In focusing especially upon the particular consistencies revealed during each of these past six bullish years of the new trend we can snatch some semblance of order and direction amidst the general noise.

Our first observation is that despite straddling the very middle of the year, pricing patterns in June and July have nonetheless, with near perfect consistency, allowed investors the very latest-possible opportunity to buy gold at levels still below the average annual price for that year.

And the key point here is that one needn't attempt to further refine their weekly or daily timing of action beyond that which is obtained by blind action -- meaning, any random assortment of purchases throughout June and July on average proves to be a fruitful maneuver by year-end.

The simplicity of this seasonal trend is a useful insight for bargain hunters. In fact, over the past 35 years , this trend holds on average, and over two-thirds of the average annual gains have been registered between August and December.

35 year gold price

For the most-recent six years , subsequent seasonal price-gains registered from August until year-end for any random assortment (i.e., average) of gold purchases made during these special two doldrum months of June and July, as demonstrated from 2001 through 2006, have averaged 10.6 percent -- representing an impressive 25.4 percent when annualized for the remainder of the year .

This certainly turns that old Wall Street adage, "to sell in May and go away," completely on its ear.

The accompanying annual price charts tell the graphic story (see right)...

Update by Randal Strauss and Jonathan Kosares for USAGOLD - Centennial Precious Metals, Denver

By Michael J. Kosares
We invite you to join the USAGOLD NewsGroup .
Important events and analysis by e-mail including our Market Updates. Free

Mr. Kosares is the owner and founder of Denver, Colorado based gold firm USAGOLD-Centennial Precious Metals Inc. He is the author of the widely read "ABC's of Gold Investing: How to protect and build your wealth with gold."

Disclaimer: when considering any market analysis, bear in mind that past trends do not necessarily guarantee future performance.

Michael J. Kosares Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in