Since hitting a short-term bottom less than two-weeks ago, gold has rebounded by nearly $100, recently trading at around $1,470 per ounce. With this, the timing models have added more than point since the extreme levels (which I have commented in past weeks) experienced just a week or two ago. The following shows the updated results for the three gold/precious metal stock timing models.
3- Month Model, -1.2
6- Month Model, -1.8
1-Year Model, -2.4
The 3-month model moved up fairly rapidly with the price of gold rebounding (Note- the model also increased due to the timing component imbedded in the models. The time component can have a significant effect on the model results, but more time than not the pricing of index, gold, and money supply are the larger influences.). The shorter of the three models gained more than 1.6 points in two weeks and is up from -2.8. The more important of the models, at least in my opinion, also showed directional appropriate rebounds. The 6-month models, currently at -1.8, gained 1.3 points over the same period while the 1-year model increased by 1.5 points to -2.4.
If anything, the historic model graphs show that, more times than not, the model results are really an instance in time and that extreme levels do not stay in that configuration for long. My guess is that the downdraft that culminating in the last few weeks was a great buying opportunity (one I did take advantage of but wish I did more so- having bought in ahead of the crack below $1,400- but missing most of the take down from $1,900, the latter where I sold my positions). Going forward, I think we will see volatile moves within the price of the precious metals and metal miners for some time. The environment will not be for the faint of the investing heart. That said, times like this present opportunities if you are willing to wait it out.
3- Month Model, -1.2
6- Month Model, -1.8
1-Year Model, -2.4
The 3-month model moved up fairly rapidly with the price of gold rebounding (Note- the model also increased due to the timing component imbedded in the models. The time component can have a significant effect on the model results, but more time than not the pricing of index, gold, and money supply are the larger influences.). The shorter of the three models gained more than 1.6 points in two weeks and is up from -2.8. The more important of the models, at least in my opinion, also showed directional appropriate rebounds. The 6-month models, currently at -1.8, gained 1.3 points over the same period while the 1-year model increased by 1.5 points to -2.4.
If anything, the historic model graphs show that, more times than not, the model results are really an instance in time and that extreme levels do not stay in that configuration for long. My guess is that the downdraft that culminating in the last few weeks was a great buying opportunity (one I did take advantage of but wish I did more so- having bought in ahead of the crack below $1,400- but missing most of the take down from $1,900, the latter where I sold my positions). Going forward, I think we will see volatile moves within the price of the precious metals and metal miners for some time. The environment will not be for the faint of the investing heart. That said, times like this present opportunities if you are willing to wait it out.
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