Tactical: Gold's Buy Season is Over
The Next Couple Months vs. the 5 Year Focus
Buy Season is Over
If you’ve lost track of time, we are well past the midpoint in “buy season” for Gold and Silver. Therefore, all the recommendations are almost out, as we’ve posted here over the last few weeks. The bank “restocking” in anticipation of asset reallocation is done, and much of the big player investment is also done. What remains is the New year buying which can be disappointing. This is precisely where the buy the rumor/sell the news concept originates.
Therefore, know that between now and January 6th you are coin-flipping if you have a position on and hope to get out with a profit in January. If however you are holding a position for longer than 6 months, you should be more inclined to not care this next week or two. You may see big moves on light volumes as brokers vwap1 their retail investment fund orders and beefy players watch. Seasonal captive flows are ending. Organic flows are next.
On the plus side: Sometimes the behavior after January 6th is a good follow through from the obvious reallocations as we’ve seen money coming out of oil and out of stocks, and into Gold and Silver. But it is not a given. For example flows definitely left oil, now oil is back up. Longer term is unchanged for us.
The Most Important Driver for the Next Five Years
Next year will be very dependent on several factors that we know of, and heaven knows how many we do not know. One thing has not changed, nor has it been discounted anywhere nearly to what it will be when all is said and done. The flip flop of monetary/fiscal roles in the economy
The markets are in the beginning leg of a fundamental regime change in how monetary and fiscal policy are implemented. We are talking of course, about the Anti-Goldilocks again. This past week alone gives big insight into how the biggest of big drivers in this market are combining to affect things. They have made 2 interdependent related decisions regarding money.