In the past week, gold increased marginally while the Philadelphia Gold and Silver Stock Index (XAU) declined –3.23%. Our Gold Stock Indicator had the following performance:
Gold (as represented by GLD) is on a relative tear of late. In the last week, gold has increased +3.41%. On the other side of the gold play, gold stocks (as represented by the Philadelphia Gold and Silver Stock Index [XAU]) gained +9.10%.
Gold (as represented by GLD) and the Gold & Silver Stock Index (XAU) finished the last week on a high note with gains of +1.45% and +1%, respectively. Although, it could be said that gold stocks took investors for a ride in order to achieve the +1% gain. The XAU Index declined as much as –2.5% before regaining all of the lost ground of Tuesday and Thursday of this week.
This week, gold declined –1.31% and the Philadelphia Gold and Silver Stock Index (XAU) declined –1.48%. Below is the Gold Stock Indicator:
Gold increased +2% in the last week while the Philadelphia Gold and Silver Stock Index declined –1%. Below is the level of the Gold Stock Indicator:
In the last five trading days, the Philadelphia Gold & Silver Stock Index has increased +6.47% while the price of gold has increased by +0.28%. Our Gold Stock Indicator is charted below:
Gold and gold stocks, based on the Philadelphia Gold & Silver Index, was unchanged for the week.
This week, gold increased +1.70% while gold stocks, as represented by the Philadelphia Gold and Silver Index (XAU), increased +3.61%. Our Gold Stock Indicator (GSI), is indicated in the chart below:
This week, gold increased +1.54% while gold stocks, as represented by the Philadelphia Gold and Silver Index (XAU), increased +4.56%. Our Gold Stock Indicator (GSI), is indicated in the chart below:
In this post, we’re going to review our Gold Stock Indicator from two perspectives, the Philadelphia Gold and Silver Stock Index (XAU) and the Barron’s Gold Mining Index (BGMI). We were curious about how closely the XAU Index and BGMI would look when applying our GSI formula. We’ve never had the BGMI data set until yesterday. The BGMI data goes back to 1973 while the XAU data goes back to 1983. Based on the charts that we’ve drawn below, we believe that our prior analysis, based on the GSI for the XAU, is confirmed and correct using the last 40 years of data for the BGMI.
On March 3, 2013 (found here), we posted the conservative and extreme downside targets for the price of gold with the following commentary:
”According to Edson Gould’s Speed Resistance Lines (SRL), gold has as a minimum decline of -25% from the closing price of Friday March 1, 2013 to the conservative downside target of $1,179.25. From our experience with Gould’s SRL, the minimum downside target is often achieved, especially when the price experiences an almost parabolic price move to the upside.
The extreme downside target of $681.75, which seems outlandish from the current level. Therefore, we’ll split the difference with an initial extreme downside target of $930.50 until proven otherwise. Already, the $1,179.25 level seems extreme in our minds.”
On December 6, 2013, the update to our downside targets for gold is depicted in the chart below:
During the last week gold and the Philadelphia Gold and Silver Stock Index (XAU) were relatively unchanged. Below is the Gold Stock Indicator from March 2012 to the present.