Waiting for my price in AUD Gold

On March 25, 2023, I wrote a cautionary note suggesting selling AUD priced Gold. 

Sell AUD Gold exposure

That observation was viewed over a weekly basis.

Gold in AUD was trading at A$3,000 at the time.

Although today’s price of A$2,882 hardly resembles a collapse, my view to not chase prices at recent highs is validated. 

Now, taking a look at a much longer timeframe……on a monthly basis

the study shows the percentages that the Gold price (in AUD) is trading above its 50 month moving average where it simultaneously traded 2.5 standard deviations above its rolling monthly mean and also registered a monthly overbought RSI reading.

There have been 6 such notable moments over the past 15 years.

Whilst the AUD Gold has never been oversold in the past 15 years, there is a case to accumulate when it touches or trades below its 50 month moving average.

The recent (and current) price action tells me to wait for the AUD Gold price to converge towards the 50 month moving average, which is somewhere around the A$2,500 region.

At that point, I’ll analyse whether Gold (as priced in AUD) will have its time in the sun, again.

Until then, I think there is little merit in entering a long position.

July 1, 2023

by Rob Zdravevski

Karri Asset Advisors

rob@karriasset.com.au