Gold Prices: Up 13 Percent in 2017

People like a winner. Have you noticed that when a sector in the market is in an uptrend, over time “everyone” becomes bullish on it? Behaviorists say there is an acceptance cycle people go through psychologically; we’ve all heard the steps, in various but related forms.  In the beginning there is disbelief.  Then there is curiosity.  Then belief.  Your Gold Enthusiast will follow the trend in gold prices and end 2017 on a high note – on a few high notes in fact.  

First, despite international gold’s rise to 1350 and subsequent fallback, it’s been a good year for gold prices – starting at 1150 and ending close to 1300 for a 13% gain isn’t bad in anybody’s book.  Depending on today’s close this will probably be the best year start-to-finish since 2010. It’s been a difficult trading year for many but these past few weeks have been very good for gold day traders.  Here’s the yearly chart for GLD, our unleveraged gold trading ETF.

(chart here, credit Fidelity.com)

Next, the miners.  Assuming things close today close to where they are now, Our proxies for the senior miners (GDX) and the junior miners (GDXJ) didn’t do as well overall, nor were their swings easier to trade. GDX (seniors) rose 11% on the year, and GDXJ (juniors) only managed 7.8%. In this chart of GDX you can see that swings were choppier than for gold itself, which caused some traders to say this was the most difficult trading year in a long time.

(GDX chart here, credit Fidelity.com)

What will 2018 bring? Your Gold Enthusiast leaves predictions to others.  And, predictably, with the recent run-up some analysts are now starting to sound downright bullish on 2018.  Remember the acceptance cycle we talked about before?  Here it is in action!  ICBC released a report yesterday saying 2018 is likely to be a good year for gold prices, with an estimated average of 1312.50.  (I for one am both happy to see the extra 50 cents on the end, and astonished that any analyst thinks the cents are significant. Or that they can be that accurate…)

We here at The Gold Enthusiast would like to thank you for reading these articles.  2017 has indeed been a difficult trading year; we had a few big hits and a few small misses, but overall did pretty well. We enjoyed hearing all your feedback, and those of you who wrote in can be proud of your contribution.  We want to continue to make The Gold Enthusiast a place where you can find important news distilled and good trading times unmasked. Have a Safe and Happy New Year, and we will see you in 2018!

Signed, The Gold Enthusiast

DISCLAIMER:  The author is long NUGT and JNUG and may add to or sell these positions in the next 48 hours.  The author has no position or intention to open a position in any other mentioned security.

 Related: You’ll Never Find a Better Time to Buy Gold – And Here’s Why

About the author

Mike Hammer

Mike Hammer has had a wide-ranging career, with trading and investing as a continuing theme. Mike graduated from UC Berkeley with a business degree, then worked with Macy's in their operations arm. He left Macy's and spent a summer trading his own account, which taught him a lot about trading in general and markets in particular. Trading through the Black Monday and the Crash of 1987 showed him how most people are unprepared for upheavals in their trading. He then joined Waddell & Reed as a financial advisor, helping regular people understand their finances and meet their life goals.

Then came the usual story - Mike met and married the lady of his dreams. They moved to upstate New York, where Mike worked first for a small manufacturing consulting company, then Cornell University. While loving the work and the higher-education atmosphere, Mike missed the world of finance. Eventually, he signed up for stock trading coaching with the Adam Mesh Trading Group, to learn from people who understood modern markets. Within a year, Adam asked Mike to become a stock trading coach.

Since then, Mike has trained over 200 individuals, spoke at several national conventions, and is a frequent contributor to conference calls across the Adam Mesh community. Mike writes The Gold Enthusiast daily newsletter, runs the Golden Hammer trading service, and participates in the Mesh Private Portfolio. He also keeps a position in international education which keep him in touch with "the student mindset". Mike closely follows the gold, energy, and financial sectors. His motto is "Plan your trade, then trade your plan!"

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