This page is to provide helpful information to those individuals interested in collecting gold coins or investing in gold bullion.

(See August Article)
(See July Article)
(See June Article)
(See May Article)

Predicted Price of Gold for September 2009

By Doug West, Ph.D.
www.investmentmetalsandcoins.com

For anyone that buys and sells gold on a regular basis it is very useful to have an idea of the approximate range of the price of gold for a given month. One way to get this information is by looking at several years of past price history and use this information to determine the price of gold for the current year. In this analysis, 25 years of price history for SPOT gold was reviewed to determine an approximate range for the price of gold in September 2009.

Trend Indicator – To help us get a better estimate of the price of gold in September we use a price trend indicator. To determine the trend for the gold price use the closing price of London SPOT gold the last trading day in August and compare it to the average price in August. If the closing price for the last trading day in August is higher than the average in August then it is an “up” open for September. A “down” open for September is when the closing price on the last trading day in August is below the average in August. In August 2009, London gold closed the month at $955.50 per ounce and the average price for August was $949.38. Based on this definition for “up” and “down”, September 2009 gold opens (or August 2009 gold closes) the month in the “up” condition. In 11 of the 25 years studied gold opens the month of September in the “up” condition. For these 11 years, gold finished the month up seven times. So the “up” indicator for the open of the month appears to be correlated to an “up” finish for the month. An “up” finish for the month is defined as the average price for September being greater than the average price for August.

Monthly Average - Looking back over the last 25 years we see that the month of September doesn’t exhibit a clear price movement trend. In 14 of the last 25 years, the average price of gold in September was lower than the average price of gold in August. We can refine our estimate of the average price change by taking into account the up indicator previously discussed. Looking only at the 11 years where September opened with an up trend gives us a three percent increase in the average price of gold when compared to August. August’s average price was $949.38. A three percent increase in this gives a projected average price for gold in September of $977.86.

Monthly High and Low – using the last 25 years of price data filtered with the “up” open indicator gives an estimate of the monthly range for gold. In a typical month, the monthly high price is four percent greater than the last trading day of August. To get an upper bound you need to add in three standard deviations to the mean change which gives $1108.38. On average, the monthly low is down one percent from the last trading day of August. Using the one percent price decrease and three standard deviations puts the lower bound  price at $888.62 per once. What all this tells us is that during the month of September 2009, the price of gold should range between $1108.38 and $888.62.

Putting it all together – During the last 25 years, the month of September has not exhibited a clear seasonal trend. To get a more useful prediction a price trend indicator was used to filter out the months that opened with the gold price down when compared to the monthly average.  Using this information we can say that in September 2009, the expected range of gold prices will be from a potential high of $1108.38 to a potential low of $888.62. The average price for the month is expected to be approximately $977.86. Based on the up trend indicator, we would expect the average price of gold to be higher than in August.  If September 2009 turns out to be typical, then this range in price should be reasonably accurate. However, all it takes is a world crisis, a stock market boom or bust, or some other big event to see a big spike up or down in the price of gold. Good luck with your gold investments and hopefully this analysis will help.

Disclaimer: this article is intended solely for information purposes. The opinions are those of the author only. Please conduct additional research and consult you financial advisor before making any investment or trading decisions. No responsibility can be accepted for losses that my result of trading on the basis of this analysis.

Predicted Price of Gold for August 2009

By Doug West, Ph.D.
www.investmentmetalsandcoins.com

For anyone that buys and sells gold on a regular basis it is very useful to have an idea of the approximate range of the price of gold for a given month. One way to get this information is by looking at several years of past price history and use this information to determine the price of gold for the current year. In this analysis, 25 years of price history for SPOT gold was reviewed to determine an approximate range for the price of gold in August 2009.

Trend Indicator – To help us get a better estimate of the price of gold in August we use a price trend indicator. To determine the trend for the gold price use the closing price of London SPOT gold the last trading day in July and compare it to the average price in July. If the closing price for the last trading day in July is higher than the average in July then it is an “up” open for August. A “down” open for August is when the closing price on the last trading day in July is below the average in July. In July 2009, London gold closed the month at $939.00 per ounce and the average price for July was $934.23. Based on this definition for “up” and “down”, August 2009 gold opens (or July 2009 gold closes) the month in the “up” condition. In 11 of the 25 years studied gold opens the month of August in the “up” condition. For these 11 years, gold finished the month up 7 times. So the “up” indicator for the open of the month appears to be correlated to an “up” finish for the month. An “up” finish for the month is defined as the average price for August being greater than the average price for July.

Monthly Average - Looking back over the last 25 years we see that the month of August doesn’t exhibit a clear price movement trend. In 14 of the last 25 years, the average price of gold in August was lower than the average price of gold in July. We can refine our estimate of the average price change by taking into account the up indicator previously discussed. Looking only at the 11 years where August opened with an up trend gives us a two percent increase in the average price of gold when compared to July. July’s average price was $934.23. A two percent increase in this gives a projected average price for gold in August of $952.91.

Monthly High and Low – using the last 25 years of price data filtered with the “up” open indicator gives an estimate of the monthly range for gold. In a typical month, the monthly high price is four percent greater than the last trading day of July. To get an upper bound you need to add in three standard deviations to the mean change which gives $1089.24. On average, the monthly low is down two percent from the last trading day of July. Using the two percent price decrease and three standard deviations puts the lower bound  price at $835.71 per once. What all this tells us is that during the month of August 2009, the price of gold should range between $1089.24 and $835.71.

Putting it all together – During the last 25 years, the month of August has not exhibited a clear seasonal trend. To get a more useful prediction a price trend indicator was used to filter out the months that opened with the gold price down when compared to the monthly average.  Using this information we can say that in August 2009, the expected range of gold prices will be from a potential high of $1089.24 to a potential low of $835.71. The average price for the month is expected to be approximately $952.91. Based on the up trend indicator, we would expect the average price of gold to be higher than in July.  If August 2009 turns out to be typical, then this range in price should be reasonably accurate. However, all it takes is a world crisis, a stock market boom or bust, or some other big event to see a big spike up or down in the price of gold. Good luck with your gold investments and hopefully this analysis will help.

Disclaimer: this article is intended solely for information purposes. The opinions are those of the author only. Please conduct additional research and consult you financial advisor before making any investment or trading decisions. No responsibility can be accepted for losses that my result of trading on the basis of this analysis.

Predicted Price of Gold for July 2009

By Doug West
http://www.investmentmetalsandcoins.com/

For anyone that buys and sells gold on a regular basis it is very useful to have an idea of the approximate range of the price of gold for a given month. One way to get this information is by looking at several years of past price history and use this information to determine the price of gold for the current year. In this analysis, 25 years of price history for SPOT gold was reviewed to determine an approximate range for the price of gold in July 2009.

Trend Indicator – To help us get a better estimate of the price of gold in July we use a price trend indicator. To determine the trend for the gold price use the closing price of London SPOT gold the last trading day in June and compare it to the average price in June. If the closing price for the last trading day in June is higher than the average in June then it is an “up” open for July. A “down” open for July is when the closing price on the last trading day in June is below the average in June. In June 2009, London gold closed the month at $934.50 per ounce and the average price for June was $945.67. Based on this definition for “up” and “down”, July 2009 gold opens (or June 2009 gold closes) the month in the “down” condition based on this trend indicator. In only 10 of the 25 years studied did gold open the month of July in the “down” condition. For these 10 years, gold finished the month down 8 out of 10 times. So the “down” indicator for the open of the month appears to be correlated to a “down” finish for the month. A “down” finish for the month is defined as the average price for July less than the average price for June.

Monthly Average - Looking back over the last 25 years we see that the month of July doesn’t exhibit a clear price movement trend. In 13 of the last 25 years, the average price of gold in July was lower than the average price of gold in June. We can refine an estimate of the average price change by taking into account the “down” indicator previously discussed. Looking only at the 10 years where July opened with a down trend gives us a two percent decrease in the average price of gold when compared to June. June’s average price was $945.67. A two percent decrease in this gives a projected average price for gold in July of $926.76.

Monthly High and Low – using the last 25 years of price data filtered with the “down” open indicator gives an estimate of the monthly range for gold. In a typical month, the monthly high price is two percent greater than the last trading day of June. To get an upper bound you need to add in three standard deviations to the mean which gives $1037.30. On average, the monthly low is down three percent from the last trading day of June. Using the three percent price decrease and three standard deviations puts the lower bound  price at $822.36 per once. What all this tells us is that during the month of July 2009, the price of gold should range between $1037.30 and $822.36.

Putting it all together - in July 2009 the expected range of Gold prices is from a potential high of $1037.30 to a potential low of $822.36. The average price for the month is expected to be approximately $926.76. If July 2009 turns out to be typical, then this range in price should be reasonable. However, all it takes is a world crisis, a stock market boom or bust, or some other big event to see a big spike up or down in the price of gold. Good luck with your gold investments and hopefully this analysis will help.

Disclaimer: this article is intended solely for information purposes. The opinions are those of the author only. Please conduct additional research and consult you financial advisor before making any investment or trading decisions. No responsibility can be accepted for losses that my result of trading on the basis of this analysis.

Predicted Price of Gold for June 2009