Gold Summer Doldrums

By Adam Hamilton – Re-Blogged From Gold Eagle

Gold’s incredible strength this summer is very unusual, as early summers are the weakest times of the year seasonally for gold, silver, and their miners’ stocks.  With traders’ attention diverted to vacations and summer fun, interest in and demand for precious metals normally wane.  So this entire sector tends to suffer a seasonal lull, along with the general markets.  This June’s bull-market breakout is a momentous anomaly.

This doldrums term is very apt for gold’s usual summer predicament.  It describes a zone in the world’s oceans surrounding the equator.  There hot air is constantly rising, creating long-lived low-pressure areas.  They are often calm, with little or no prevailing winds.  History is full of accounts of sailing ships getting trapped in this zone for days or weeks, unable to make headway.  The doldrums were murder on ships’ morale.

Continue reading

Advertisements

Gold-Stock Summer Lows

By Adam Hamilton – Re-Blogged From http://www.Gold-Eagle.com

The gold miners’ stocks have been drifting sideways to lower like usual in their summer doldrums. They are likely near their major seasonal lows ahead of a strong autumn rally, a great buying opportunity. Gold rebounding higher will be the primary driver fueling the gold-stock advance, dispelling today’s bearish psychology. And strong Q2 production growth will likely play a sizable role in restoring favorable sentiment.

Market summers have long been gold’s weakest time of the year seasonally. Junes and early Julies in particular are simply devoid of the big recurring demand spikes seen during most of the rest of the year. With traders vacationing to take advantage of warm sunshine and kids being out of school, markets take a back seat. So there’s no outsized gold buying driven by income-cycle or cultural factors this time of year.

Continue reading

Gold Summer Doldrums 2

By Adam Hamilton – Re-Blogged From http://www.Gold-Eagle.com

Early summer is the weakest time of the year seasonally for gold, silver, and their miners’ stocks. With traders’ attention diverted to vacations and summer fun, their precious-metals interest and investment demand wane considerably. Thus this entire sector, and often the markets in general, suffer a seasonal lull this time of year. But these summer doldrums offer the best seasonal buying opportunities of the year. Continue reading

Precious Metals Bears’ Fear Of Fridays

By Dimitri Speck – Re-Blogged From http://www.Silver-Phoenix500.com

In the last issue of Seasonal Insights I have shown that the gold price behaves quite peculiarly in the course of the trading week. On average, prices rise almost exclusively on Friday. It is as though investors in this market were mired in deep sleep for most of the week.

Upon this I received a plethora of inquiries from readers regarding the corresponding moves in silver. Thus I examine the behavior of the silver market on individual days of the week in this issue of Seasonal Insights.

Continue reading

Gold Stocks’ Winter Rally

By Adam Hamilton – Re-Blogged From http://www.Gold-Eagle.com

The gold miners’ stocks have largely ground sideways this year, consolidating their massive 2016 gains. That lackluster trading action, along with vexing underperformance relative to gold, has left gold stocks deeply out of favor. But these uninspiring technicals and resulting bearish sentiment should soon shift. The gold stocks are just now entering their strongest seasonal rally of the year, the super-bullish winter rally.

Gold-stock performance is highly seasonal, which certainly sounds odd. The gold miners produce and sell their metal at relatively-constant rates year-round, so the temporal journey through calendar months should be irrelevant. Based on these miners’ revenues, there’s little reason investors should favor them more at certain times of the year than others. Yet history proves that’s exactly what happens in this sector.

Continue reading

Major Gold-Stock Breakouts

By Adam Hamilton – Re-Blogged From http://www.Gold-Eagle.com

The gold stocks are off to the races again, with big gains mounting. They just staged major breakouts, shattering a vexing consolidation that had trapped them for an entire year. Such momentum early in gold’s strong season is a very-bullish portent. As higher prices improve both technicals and sentiment, buying begets more buying. With gold-stock prices still quite low in secular terms, their upside remains huge.

Gold stocks are a small contrarian sector without a wide following. So their latest surge has surprised many investors and speculators. But it shouldn’t have. In the markets knowledge is profits, so staying informed about gold stocks’ fundamentals, technicals, and sentiment is crucial. The traders who did their homework this summer and bought in low when few others were willing are now sitting on fat unrealized gains.

Continue reading

Gold Stocks’ Winter Rally

By Adam Hamilton – Re-Blogged From Zeal LLC

The gold miners’ stocks have certainly had a wild ride this year.  After initially skyrocketing out of deep secular lows into a mighty new bull market, they recently suffered a massive correction climaxing in an extreme plummet.  This coincided with gold stocks’ major seasonal low in October.  That heralds their strongest seasonal rally of the year heading into and through winter, a very bullish omen for coming months.

Gold-stock performance is highly seasonal, which certainly sounds odd.  The gold miners produce and sell their metal at relatively-constant rates year-round, so the temporal journey through calendar months should be irrelevant.  Based on these miners’ revenues, there’s no reason investors should favor them more at certain times of the year than others.  Yet history proves that’s exactly what happens in this sector.

Seasonality is the tendency for prices to exhibit recurring patterns at certain times during the calendar year.  While seasonality doesn’t drive price action, it quantifies annually-repeating behavior driven by sentiment, technicals, and fundamentals.  We humans are creatures of habit and herd, which naturally colors our trading decisions.  The calendar year’s passage affects the timing and intensity of buying and selling.

Continue reading