Posts tagged: cyclical market

A Technical Analysis of Gold’s Secular Uptrend

 

Introduction:

Building upon the previous three studies on gold, we conclude with a technical analysis of gold’s secular bull market trend since 2001. We will use time series analysis to determine gold’s secular trend growth rate, and historical volatility to set the trend boundaries. The trend and its historical boundaries will offer a reference point for identifying where we are today – a first step in any decision making process.

Technical analysis, with its proclivity to market timing, is a critical part of the investment decision process regardless of methodology or time horizon. I hope that this article will make it increasingly obvious how closely related technical analysis is to fundamental analysis and how the two disciplines are indeed inseparable.
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Relationship Between Gold, Inflation, and Equities II

 

Introduction:

In part-1 of this study, we considered the question of whether monthly returns of gold were correlated with those of inflation or equities in the United States of America. We analyzed three decades of monthly returns using two statistical techniques, correlation and regression analysis. Were you surprised by the results?

Here in part-2 we will investigate whether there has been a relationship between the long term price trends of gold, inflation, and equities. But before we do, let us first clearly distinguish between “correlation of returns” and “price trends“.

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Relationship Between Gold, Inflation, and Equities

 

Introduction:

No doubt you have often heard it stated as a matter of fact that gold is a hedge against inflation or, what may at first glance seem synonymous, that gold is correlated with inflation. Have you wondered to what degree this may be true, if it is true at all? Perhaps curiosity about gold has been piqued in light of recent record gold prices coupled with economic conditions in general.

In this first of two articles we will assemble and analyze data describing the statistical correlation between the monthly returns of gold, inflation, and equities. And in part-2 of this study we will compare the long term price trends of gold, inflation, and equities. Read more »

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