As we reach the end of October, we’ve had some encouraging movements in the metals. However, gold bugs are a bit discouraged too, since we’ve been unable to retake previous highs. Many speculated that 2000 gold was in the bag this year, but are not skeptical. It’s quite possible they’ll be very pleased in time for Christmas.
November shows a history of profits in metals. Last year, a strange turn for metals, gold and silver went in different directions. However, in only three of the past ten years both metals turned down in November. In 2004, after a nice pop, in 2006 then again in 2009. During 2007, when everything seemed to be falling apart, metals held up into the end of the year, only falling when the bottom fell out of everything.
The vertical lines in the chart represent the October closing price for each year. As you can see, buying metals at the beginning of November turned out to be profitable, year over year, every year except 2007/08, and last year. With gold you would be about even from a year ago, while in silver you’d have a slight loss.
The red lines represent presidential election years. It’s clear that these had no consistent effect over only a decade though.
With prices in a nice consolidation right now, we’re thinking that anyone who owns metals will have much to be grateful for on Thanksgiving. Depending upon how things move in the next month or so, a nice Santa Rally isn’t out of the question either.
For your prosperity,
J. Keith Johnson
The Gold Informant