Gold Stocks’ Autumn Rally 8

July 31, 2023

by Adam Hamilton Zeal LLC

The gold miners’ stocks have resumed grinding higher on balance, mean reverting out of their summer-doldrums selloff. Their usual seasonal autumn rally driven by gold’s own looks to be gathering steam. Outsized Asian gold demand typically fuels solid-to-good precious-metals gains this time of year. And the coming months have much-better upside potential than normal with the Fed’s extreme rate-hike cycle ending.

Seasonality is the tendency for prices to exhibit recurring patterns at certain times during the calendar year. While seasonality doesn’t drive price action, it quantifies annually-repeating behaviors driven by sentiment, technicals, and fundamentals. We humans are creatures of habit and herd, which naturally colors our trading decisions. The calendar year’s passage affects the timing and intensity of buying and selling.