Gold
Gold is now approaching a very strong time of year. If you take a look at gold from December 24 through to February 19 over the last 25 years you will see that gold has risen during that time a total of 18 times. The average return has been a +3.96% profit and a maximum profit of 14.43%. The largest loss has been -6.57 and that was during 1996.So, seasonally speaking gold is attractive. Check out some of the stats below:
Tonight the Fed will meet for the last time this year. A dovish twist here and that could be the catalyst that gold needs to launch into a strong gain for 2021. The Fed is limited in what it can do as financial conditions are already loose with very low interest rates. However, the Fed has the following key options it can implement to create easier conditions:
- Lengthen the maturities of the bonds
- Expand total purchases from $120 billion a month
- List the outcomes it wants to achieve before winding the program back
If we see the Fed making a move here watch out for gold buyers to step in and try to hold it through January.
