Thursday, September 10, 2009

Gold - Seasonal Rally

Above is a seasonal chart (courtesy of Moore Research Center) of gold from 1974 -2007. Over the past 34 years gold has showed a strong seasonal tendency to rally from September into early October. This tendency to rally has been very consistent for many years and I believe what we are seeing in the gold market right now is the beginning of this seasonal rally.

Below is the current chart of gold (GLD) and you'll notice that this market has begun its rally right on time with the seasonal forecast. Having said that, I believe gold should continue to rally especially after breaking out of a large symmetrical triangle which I've been writing about for quite some time now.

The question that remains is will the seasonal bias rally gold into October? Will gold rally even though EVERYONE is BULLISH? Only time will tell but I'm going to go with my original opinion and that is to be bullish until proven otherwise.


Anonymous said...

Good call on gold. I have a sizable position in GDX and I was eying the triangle tip. I did not fail. If I understand the triangle, the goal should be GLD of roughly $110, right?

Kevin said...

My target for GLD is $105


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