It’s Getting to Feel a Lot Like Christmas

Okay, so we are still a good month and a half away from Christmas, and especially in Hawaii, there is no snow on the ground. However, there are some distinct parallels to recent year-end activity when it comes to gold pricing.

First and foremost, gold pricing tends to selloff at the end of the year, followed by a rally at the beginning of the next year. Every year since 2014 gold pricing has declined towards the end of the year and then bottomed at the beginning of the next calendar year to then stage a respectable rally.

Gold prices peaked just shy of $1500 an ounce in August 2013, before trading to a low of approximately $1100 by the end of that year. From the end of December until the first week in March, gold rallied from those lows until it reached the yearly high of 2013 at just below $1400 an ounce.

Gold prices also hit their yearly low towards the end of 2014, and by the middle of November began a rally that would last into 2015. During the first month of that year, gold prices rallied from the lows achieved the prior year to the high achieved that year at $1300.

The high achieved the second week of January 2015 turned out to be the highest value for gold that year. Prices once again bottomed around the middle of November when they reached the lowest price since gold had begun to selloff from $1900, trading to a low of $1040.

2016 resulted in the first occasion when gold traded to a higher high than the previous year. In fact, by August of last year gold prices had reached $1380, trading in a narrow range before beginning a dramatic selloff immediately following the presidential election.

Once again, gold prices reached their low towards the end of the year, when in mid-December of last year gold prices bottomed at $1120.  Gold would start a beginning of the year rally, which once again lasted until August 2017, with gold prices reached an apex at $1360.   From there, just as in past years, gold prices would drop as we moved closer towards the end of the year.

Which brings us to our current pricing with gold currently fixed at $1278. Although we are still a full week away from the long Thanksgiving holiday, it is beginning to feel a lot like former years in which gold prices tend to decline towards the end of the year and then rally either at year end for the beginning of the next year.

This observation gives us both dismay and optimism regarding gold pricing.

The dismay comes from the fact that gold prices could continue to decline a little further, while the optimism stems from the fact that gold prices typically bottom towards the end of the calendar year which is followed by a substantial and respectable rally.

Wishing you as always, good trading,