I was a little disappointed in the 2.2% decline in the Phily Gold/Silver Index (ticker: XAU) this week, but in some respect this was likely to be expected considering the negativity towards gold and precious metals-related shares. Additionally, the 2% decline in no way negates the outlook provided by the timing models, as the performance was comfortably within historical results.
Turning to the timing models, the model turned somewhat less positive this week, as money supply ticked down by a small amount and the price of gold was just slightly higher. The 3-momth model hovers around -1.69, the worst of the bunch, while the 1-year and 6-month model are far better. The 1-year model remains under -2 with a -2.1 showing while the 6-month model is presently a -1.75, worse off than the -2 in the previous week. The chart of the model results is presented below.
3-Month Model
1-Year model
6-Month Model
The models remain near the bottom of their respective channels, suggesting a good opportunity to be accumulated gold and precious metal-related shares. I also thought it would illustrative to show the historic performance results of the models when both the 1-year model is at or below -2.1 and the 6-month model is at or below -1.75. Since the early part of the last decade, there were only five individual weeks that this setup occurred. The following table shows the 1-week, 3-month, 6-month, 1-year performance figures of the XAU following this setup, comparatively to the buy-and hold performance figures.
Buy-and Hold
1-Year Model below -2.1 and 6-Month Model below -1.75
Although there is no guarantee that future results will look resemble the past, I for one will accept the odds that the performance bias will be towards the positive and will continue to accumulate the gold and precious metal shares.
Turning to the timing models, the model turned somewhat less positive this week, as money supply ticked down by a small amount and the price of gold was just slightly higher. The 3-momth model hovers around -1.69, the worst of the bunch, while the 1-year and 6-month model are far better. The 1-year model remains under -2 with a -2.1 showing while the 6-month model is presently a -1.75, worse off than the -2 in the previous week. The chart of the model results is presented below.
3-Month Model
1-Year model
6-Month Model
The models remain near the bottom of their respective channels, suggesting a good opportunity to be accumulated gold and precious metal-related shares. I also thought it would illustrative to show the historic performance results of the models when both the 1-year model is at or below -2.1 and the 6-month model is at or below -1.75. Since the early part of the last decade, there were only five individual weeks that this setup occurred. The following table shows the 1-week, 3-month, 6-month, 1-year performance figures of the XAU following this setup, comparatively to the buy-and hold performance figures.
Buy-and Hold
| 1 Week | 3 Months | 6 Months | 1 Year | |
| Avg | 0.26% | 3.09% | 6.54% | 13.24% |
| Median | 0.27% | 2.15% | 4.94% | 12.09% |
| Max | 25.37% | 89.59% | 88.09% | 151.78% |
| Min | -30.86% | -62.22% | -62.18% | -64.56% |
| Batting Avg | 53.2% | 56.4% | 62.1% | 67.1% |
1-Year Model below -2.1 and 6-Month Model below -1.75
| 1 Week | 3 Months | 6 Months | 1 Year | |
| Avg | 14.22% | 44.46% | 53.02% | 96.21% |
| Median | 9.89% | 47.55% | 57.51% | 95.03% |
| Max | 24.27% | 89.59% | 88.09% | 151.78% |
| Min | 3.70% | 2.15% | 12.45% | 33.60% |
| Batting Avg | 100.0% | 100.0% | 100.0% | 100.0% |
Although there is no guarantee that future results will look resemble the past, I for one will accept the odds that the performance bias will be towards the positive and will continue to accumulate the gold and precious metal shares.
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