While the timing of golds take off can not be determined for sure by those of us outside the halls of power we can still attempt to make an educated guess.

I thought in begining of January that gold would have made a new nominal high here in February but that is obviously not going to happen.

It occured to me in later January when gold failed to gain any of its typical seasonal strength that since the summer the seasonality of the metal had been inverted. When gold typically should have been showing strength it was weak and when it sould typically be weak it has been strong.

Now I am sure this has thrown a lot of gold investors who use seasonality off. However it makes sense from the point of view of someone who wishes to accumilate. It has no doubt gotten many investors buying and selling at the wrong times.

If this trend continues then I would expect that during the last part of February and into middle of Arpil when gold typically shows weakness that it will increase in price. So far in the later part of February gold has recovered about $50 from its low and thus so far so good.

It would appear to me that the mining companies in December when gold was making new nominal highs probably temporarly supressed the price by selling whatever bullion inventory they had on hand. This certainly would explain the very good 4th quarter results and make sence from a window dressing and year end perspective.

If the mining companies did sell much of there bullion inventory in December than that would leave suppies somewhat lacking in the new year. Especially if the mining companies decided that there was no real rush to sell bullion on the open market since many of them are sitting flush with cash to run there operations. Certainly if I were a CEO of one of these companies that is a consideration I would deeply consider.

Thus once again we could very well see an unexpect rise in gold and silver prices come April that catches many precious metals investors that practice seasonality and tech analysis sitting once again on the wrong side of the trade.

All in my honest opinion of course.

F.F.