Thanksgiving Has Been Historically Favorable to Gold Price

For years now, the Thanksgiving holiday in the U.S. has been a very favorable two-day period for the gold price as shown below - this year is not likely to be an exception.
While anything could happen later this week, a number of conditions have developed that would favor a higher gold price by the weekend, perhaps much higher.

First, due to the closure of the Comex in New York on Thursday and light trading on both Wednesday and Friday, there will be less selling than usual coming from New York bullion banks - this has probably played a big role in the steady gains over this two-day period in recent years as shown above.

Second, the gold price has surged recently, up almost a hundred dollars an ounce in just the last week, and this has undoubtedly caught the fancy of "momentum traders" around the world who may now set out to push the price higher.

[Note: If you go back to the day or two before Thanksgiving last year, you'll see that the price of gold has actually risen since then - from about $795 last year to about $815 as this is written for a modest 3 percent gain. Are there any other assets (aside from the U.S. dollar) that sport a year-over-year gain today?]

Lastly, there are those shrinking short positions for both gold and silver and the unknown number of holders of December futures contracts who, on Friday, will announce their desire to take delivery of the metal next month rather than having the contracts settled in cash.

Over the last eight years, the biggest moves have come on Friday, so try not to go into the day with too big of a turkey-hangover.

Comments

[GMiki1:]

Gold is the only thing that's held up for me this year.

At some point, when the Dubai exchange opens for the precious metals contract trade, the COMEX precious metals exchange will be toast. The COMEX has allowed naked shorts by the--hey, remember the days when we had big banks?

Why won't Dubai allow the same? Because Moslem law demands honesty. Too bad we didn't use honesty as a standard here.

2008 Nov 26 10:44 AM

[Anthony Alfidi:]

Let's not forget one of the big drivers of gold's recent rise: massively inflationary bailouts and their attendant debt issues. That yoy gain in the U.S. dollar won't last long when foreign central banks start dumping their devalued dollars.

2008 Nov 26 07:33 PM

[Socialism c...:]

Too bad Muslims damage their credibility on every other front. Their law demands many other odious things. Those who stick to the letter of the Koran are known as "Islamic fundamentalists"...tho... who don't are "apostates." I wouldn't go encouraging faithfulness to Islamic law, if I were you -- it doesn't end too well.

On Nov 26 10:44 AM GMiki wrote:

> Why won't Dubai allow the same? Because Moslem law demands honesty.
> Too bad we didn't use honesty as a standard here.

2008 Nov 26 10:09 PM

[DollarTalk:]

I am very thankful for the blessings that I have in my life. Now, regarding the market, the power of optimism never ceases to amaze me. In fact, we are missing a very large component of our view on the market and the economy in larger view when we discount the role of perception. Most of this market volatility was brought on by increased uncertainty and the perception that our credit crisis and financial difficulties were beyond our ability to solve as a free market. This, of course, was exacerbated by the media and capitalized on by the media in order to accomplish the election of now President-elect Obama. Now, the media has their man and would do well to continue to promote positive, uplifting views on the future direction of the economy and the solutions and people proposed by President-elect Obama. Otherwise, they will find themselves in the company of the Republican party when the public develops a pessimistic or negative perception of the new President and his leadership team. That's all for now. More on my blog.

2008 Nov 27 01:51 AM

[tonny adamms:]

well,interesting recollections!Gold is here to stay no doubt.Thanx Tim for the moral boost!

2008 Nov 27 03:09 AM

[Bengunnscave:]

Food for thought 'Socialism cannot compete'. The 'damaged credibility' and ethnocentric issues of the Muslim culture are perhaps only matched and exceeded by our own. Seeking objective truth can often be a difficult task, this is an area in which we all can improve.

It takes a good bit of angst to morph an article about gold price around Thanksgiving into a rant about someone else's way of life. Perhaps a little more cultural tolerance and understanding in this world would go a long way toward keeping on the ground planes bound for buildings.

A great rule for both investing and living life is to constantly and objectively ask yourself, What if I'm wrong?

Good day Sir.

2008 Nov 27 01:00 PM

[Socialism c...:]

"The 'damaged credibility' and ethnocentric issues of the Muslim culture are perhaps only matched and exceeded by our own."

Sorry Bengunnscave, you are patently wrong. The U.S. has not damaged its credibility anywhere near the way Islam has -- if we have erred at times, we have admitted the mistake and taken steps to prevent repeats. Secondly, such recognition is often brought about by groups within our own sphere -- Americans either in the military or civilians, who in the given situation "blow the whistle", call for change, etc. We have a system of government with protections built in for those who would criticize the government and its movements. Islam does not allow that. You criticize, you risk a fatwah being put on your head. And don't dare be a woman and demand equal rights with men. Do you dare to even compare American ideals with Islamic? It is night and day, my friend. And that is clear to any unbrainwashed observer.

"It takes a good bit of angst to morph an article about gold price around Thanksgiving into a rant about someone else's way of life. Perhaps a little more cultural tolerance and understanding...."

Again, don't preach "tolerance" -- because what is being talked about here is not someone's preference for flavor of ice cream. We're talking about Islam's fundamental beliefs that encourage jihad against all non-believers. We all must ultimately either convert or agree to be governed by shariah law as subjects, paying a "blood tax" if we do not convert. Islam has been violently militant almost continuously since its inception in the 7th century. There is *nothing* tolerable about the terrorist tactics employed in their modern jihads, and this is *not* about understanding "someone's way of life."

2008 Dec 01 02:11 PM

[Bengunnscave:]

The point is not to tell you that I am right or you are wrong, but rather to take the opportunity for all readers to reflect that none of us has the right to claim we know the ultimate truth for all of us.

After reading your response however, I realize that perhaps you do hold the ultimate truth. You are right, the USA is the best, everyone else is below us, they all want to be just like us because we are the best, we always have the moral high ground, anyone who dislikes us is in the wrong and anyone who disagrees with us must be wrong. Sure we make some honest mistakes but we always correct them. We are not ethnocentric because we are always in the right. We will remain on the top of the world because we are the greatest and we do not need to question our own views because we already know they are right!

Thanks for your insight, I've finally got it, it is all so clear for me now.

And also thanks for helping to prove my point for me with your response. I'll go ahead and let you have the last word since you are the holder of the truth.

And then we can get back to the issue at hand, whether or not you would like to put this aside and join me for a drink on my pirate island whilst counting dubloons?

2008 Dec 02 12:16 AM

[Natalie Le:]

Go buy Superfund gold funds. They're up 17-20% ONLY IN NOVEMBER. Their other funds are up 33-70% YTD.
The MD said gold is gonna double to $2000 coz of hyperinflation.
www.youtube.com/watch?...

2008 Dec 03 02:57 AM