Category Archives: gold

Gold declined –1.37% while the index for gold stocks declined by –3.49% in the past week.  The closing numbers for gold stocks would be considered deceptive since the decline was much worse earlier in the week when the decline for the index was as much as –8%.

Gold, as represented by the SPDR Gold Shares (GLD), has registered a loss of –5.19% since our last posting on February 13, 2015.  At the same time, gold stocks, as represented by the Philadelphia Gold and Silver Stock index (XAU), have declined –12.34%.

Since our January 30, 2015 posting, the price of gold, as represented by the SPDR Gold Shares (GLD), has declined –4.43% while the Philadelphia Gold and Silver Stock Index (XAU) has declined –2.87%. 

It is unusual that the price of the gold stock index would decline less than that of the price of gold.  Either the gold stock index needs to decline much further or the price of gold should rebound.  Remember that gold stocks are the sentiment indicator for the price of gold, therefore, the pricing action above might suggest that the gold declines aren’t sustainable.

The Gold Stock Indicator is reflecting this relative strength with the marginal declines as indicated in the chart below.

Gold, as represented by the SPDR Gold Shares (GLD), increased +1.89% this week while the Philadelphia Gold and Silver Stock Index (XAU) declined by-0.18%.  On a closing basis, each index made new highs this week.  However, some ground was given up on Friday.

If you like excitement and intrigue then invest in gold.  However, if you want a heart pounding adrenaline rush then try investing in gold stocks.  This past week, gold did nothing but go up, closing out the week with a gain of over +4%.  Gold stocks, on the other hand, tested the fortitude of investors by falling more than –6% but eventually closing up nearly +3%.

The recent surge of gold was due to the Swiss National Bank’s decision to remove the cap on the Swiss Franc.  Many are calling the Swiss decision a turning point in the bear market for gold.  However, we’d want to remind investors that the turning point, if in fact it is the ultimate low for gold, was on November 5, 2014.  That was the time and place when the low was established before increasing in value.

Gold, as represented by the SPDR Gold Trust (GLD), gained +1.89% while gold stocks, represented by the Philadelphia Gold and Silver Stock Index (XAU), gained +7.26% in the last week.

Overall, a quiet couple of weeks for gold and gold stocks as represented by the gold ETF and XAU index, respectively.

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