At the very least, you can say we have seen some very interesting dynamics in the gold investment complex in the last week. Both the yellow metal and the gold equities retested their respective June/July 2013 bottoms, both on lighter respective volume levels, and have soundly rejected these levels. If you remember, this apparent (at least in the short term) bottoming occurred while the growth in money stock began to reaccelerate, albeit helped by seasonal factors, and the market came to the realization that the Fed will be unlikely to pair down their bond buying anytime in the immediate future. These dynamics, including an increase in buying interest, pushed the price of gold up by about $50 per ounce and the Phily Gold/Silver Miner Index by more than 13 points in the course of a week. Both rather significant moves off the bottom.
All together, these moves pushed the timing models more towards positive demarcations in the latest week's run. The results are shown below.
6-Month Model, -0.1 currently vs. -0.81 last week and -0.75 last month
1-Year Model, -0.90 vs. -1.17 and -1.21
2-Year Model, -1.52 vs. -1.77 and -1.83
Risk Model, positive once again after toying with the zero line.
I continue to accumulate precious metals and precious metal equities, as the timing models continue to indicate better-than-average future appreciation potential. This is in conjunction with a risk model that has rejected lower results. Looking ahead, I have my doubts that we have seen the ultimate bottom. Gold and precious metal related investments may just put in a more complicated bottom before resuming the structural upturn. Very few considered the possibility that the Fed would maintain their $85 billion/month bond buying program at their last meeting, and although I think that the chance of a definitive taper has dwindled, stranger things have happened.
All together, these moves pushed the timing models more towards positive demarcations in the latest week's run. The results are shown below.
6-Month Model, -0.1 currently vs. -0.81 last week and -0.75 last month
1-Year Model, -0.90 vs. -1.17 and -1.21
2-Year Model, -1.52 vs. -1.77 and -1.83
Risk Model, positive once again after toying with the zero line.
I continue to accumulate precious metals and precious metal equities, as the timing models continue to indicate better-than-average future appreciation potential. This is in conjunction with a risk model that has rejected lower results. Looking ahead, I have my doubts that we have seen the ultimate bottom. Gold and precious metal related investments may just put in a more complicated bottom before resuming the structural upturn. Very few considered the possibility that the Fed would maintain their $85 billion/month bond buying program at their last meeting, and although I think that the chance of a definitive taper has dwindled, stranger things have happened.
No comments:
Post a Comment