Monday, November 4, 2013

Just Bouncing Around With All That Glitters (Gold)

Not much to comment on in this weeks post. Gold and the gold equities took a dive and consolidated recent gains last week, with the price of gold moving back towards the $1,300 price per ounce level. In conjunction, the non-seasonally adjusted money stock came out ahead of the normal seasonal trend, albeit still following a similar growth path, coming out ahead of $10.9 trillion in the most recently reported week. All in, this lead to lower demarcations in the timing models, as shown below.

6-Month, current -0.7 vs. -0.1 last week and -0.9 last month

The six month model calculation appears at the mercy of the volatile swings in gold/gold equities.

1-Year, -1.1 vs. -0.9 and -1.2

A little more stable than the 6-month model calculation, the 1-year model still dipped below the -1 demarcation. Remember, negative results are better, on average, on a go forward performance perspective all else equal.

Long-term model calculation, -1.7 vs. -1.5 and -1.8

Although the long-term model calculation is typically immune to volatile intra-week swings, the model still fell back 0.2 to -1.7 from last week.

The risk model sits at the zero line once again. As a reminder, risk scores that are rising or above zero in conjunction with a negative demarcation on the timing models may provide more insight into purchasing gold equities versus the timing models alone.
Risk Model, sitting at the zero demarcation once again

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