Gold Seasonality Over 30 Years

April 30, 2003

The 'Gold: Second Half Increase' is the seasonal rise in gold, starting on May 5 and ending on January 21 of the following year. The increase was observed in 20 of 30 years, resulting in an average profit of +19.2%. But there were also 10 years, where the price of gold fell during this period of the year. The average loss then was -12.3%. The overall rise during all 30 years was +7.6% p.a.

The 'Gold: Second Half Increase' lasts 259 calendar days. It took place in 66% of all years. Thus the statistical stability of this seasonal pattern is acceptable. It is necessary to take steps to minimize losses (e.g. through stop loss).

There was no 'Gold: Second Half Increase' during the second half of the 1990s. Gold fell during those years. More, it is being manipulated by order of the central banks. Thus one cannot judge accurately, whether this seasonal pattern is valid at present. The following table shows all 'Gold: Second Half Increases' since 1985:

 19850507   313.50     19860121   356.50     43.00   13.72  %
 19860507   342.45     19870121   407.20     64.75   18.91  %
 19870507   456.25     19880121   477.20     20.95    4.59  %
 19880509   444.40     19890123   407.45    -36.95   -8.31  %
 19890508   378.25     19900122   406.00     27.75    7.34  %
 19900508   370.65     19910121   378.20      7.55    2.04  %
 19910507   356.15     19920121   357.80      1.65    0.46  %
 19920507   336.05     19930121   329.75     -6.30   -1.87  %
 19930507   357.50     19940121   386.00     28.50    7.97  %
 19940509   381.00     19950123   382.35      1.35    0.35  %
 19950509   388.10     19960122   402.20     14.10    3.63  %
 19960507   393.70     19970121   354.70    -39.00   -9.91  %
 19970507   341.10     19980121   291.00    -50.10  -14.69  %
 19980507   298.10     19990121   287.75    -10.35   -3.47  %
 19990507   282.40     20000121   287.75      5.35    1.89  %
 20000508   277.90     20010122   266.15    -11.75   -4.23  %
 20010508   265.20     20020121   282.30     17.10    6.45  %
 20020507   312.00     20030121   353.80     41.80   13.40  %

Notice: Our Hot Tips are no trading recommendations. In fact, they are a real time test of seasonal patterns. Trading with seasonality requires additional means to reduce losses, for example diversification, the implementation of further indicators, or stop losses. You can find an introduction into seasonal trading under trading strategies. Please take also notice of the results of our previous tips and of our disclaimer.


 

www.seasonal-charts.com

USA has the world’s largest holdings of gold: 8,134 - representing 77% of its Total Foreign Reserves.