The asset management company and author of the ‘In Gold We Trust Report’, Incrementum recently published this compelling graph below, stating that gold is entering its ‘strongest seasonal phase’, with the suggestion that its recent lack-luster performance could now be close to a bottom before it begins to climb again. According to this graph, between the months of July and September could be the optimal time to buy gold.
Right now, the gold price is rallying against what so far this year has been a very strong dollar. Last week, we were looking at an eight month low of just over $1680/oz, but as I write this the precious metal is pushing over the $1727 mark and Wells Fargo is still supporting its prediction that it will end the year around $2050 an ounce and you can see from this next chart how some pundits are looking into the future.
Gold retreated around 6% in June and needs to surge around 17% to hit the Wells Fargo prediction, but with recession knocking on the door and gold being very reasonably priced right now against other commodities, it’s likely that investors and savers may find that right now is the perfect time to buy gold as a hedge against the coming months of uncertainty.
The US dollar has been unprecedentedly strong over the last year, but this is almost entirely due, not to any outperformance of the US economy, but rather to more weakness elsewhere in the world. Most world economies are now effectively in, or approaching, recession – as defined as two successive quarters in negative growth – a continuation of which could lead to a return to a 1930’s depression.
It’s likely that the crash in crypto, as well as the ongoing downslide for general equities will soon be joined by a slump in house prices, as mortgage rates increase along with higher interest charges, leaving disposable income falling in relative value against rising inflation.
So, in this crazy world that we live in right now, there are lots of reasons for considering gold as a potentially safer way to help protect your savings. Take the Gold Seasonality Chart above, historically, there are better months in which to purchase gold than others when it comes to a buying strategy. There are various reasons for this, notably events such as the wedding season in India; Diwali etc. which are annually repeatable patterns that have traditionally been used to help predict growth in the value of your gold.
According to Tradingview.com, statistically speaking, September has shown the most positive returns, with July coming a close second, followed by November, but that doesn’t mean that you shouldn’t buy gold outside of these months. Clearly we’re not offering you any financial advice but, buying gold when the price is low may be a good strategy to see its growth. It’s worth noting that this year we have seen an anomaly, March is usually one of the worst performing months for gold, but on the back of Russia’s invasion of Ukraine on 24th February, we saw it doing its job protecting your savings as we watched its price spike in excess of $2000.
So, there’s no hard science about when you should or shouldn’t buy gold, but when the world economy seems to be on its uppers and we have the aftermath of the Covid pandemic, worker shortages in the US as well as geopolitical distress in central Europe; all this combined with the seasonally optimal summer gold buying months of July into September and you might consider that right now, today, is a pretty good time to top up your Glint account with some solid, allocated gold, kept safe in a non-government Brink’s vault, insured by Brink’s with Lloyds of London.
Add to this the unprecedented liquidity that Glint has brought to gold, enabling you to buy, sell, save, send and even spend the precious metal using your Glint app and debit Mastercard® then it stands to reason that (if you haven’t already) popping over to the app store and downloading the free Glint app might be the best decision you made this year… Clearly there are no guarantees, but if you need evidence that putting your money into gold is better value than keeping it in fiat currency or gambling with stocks and shares, take a look at the charts above and below – all charts from the www.ingoldwetrust.report.
At Glint, we make every effort to demonstrate a balanced conversation between gold, crypto and fiat currencies when it comes to purchasing power and, while we strongly believe that gold is the fairest and most reliable currency on the planet, we need to point out that it isn’t 100% risk free. While we have seen a steady increase over time, the value of gold can fall, which means that its purchasing power can also decline.
Gold is security. Glint its key.