This is Starting to Get Old with All that Glitters

As I hinted at here, the gold and precious metal stock timing models remain in mid-buy range, the same as last week, the previous week, and so on. And don't get me wrong, I could be a buyer of gold and precious metal stocks given current the timing model results. However lacking is any sign of strength in either commodity gold or in the stocks themselves. I mean just have a look.

First, commodity gold, here represented by the Spider Gold Trust (ticker GLD)

The GLD appears caught in a range since mid December. Even still, the MACD, Accumulation/Distribution line, and money flow measures are all in negative territory, all suggesting to me that their distribution going on despite a flat price performance. More ominously, is the price of gold stocks.

The Market Vectors Gold Miners Trust (ticker GDX) took a nosedive in mid January on some of the highest volume levels seen in the last year.

This has been followed up with very weak follow through to the upside. This setup suggests, in my opinion, that the GDX is likely to hit the 2012 lows at the very least. And rounding back to gold, precious metal stocks tend to lead the price gold by at least a few months, and ultimately the weakness in the gold shares will likely be reflected in the price of gold. All in all,I am expecting the timing model levels to improve in the weeks and/or months ahead.

As for the current timing model results, they all remain in mid-buy areas. I would continue to wait for either strong buy indications on the models or a sign of strength in the gold stocks before fully committing to shares in the precious metal complex.

3-Month Model, -0.63


1-Year Model, -0.99


6-Month Model, -1.07