Between July - October, gold strengthens. But he's not a gold bug at all. It's dead money, and a tax issue in the States. If there's a strong USD, then why buy gold? Maybe, just maybe, play gold as a very short-term play, but no more than that.

It is in a longer term upward trend.  Seasonal strength is from July to Mid-October.  This year we have seen a nice little pickup.  Technically it looks good as well.  There is a good chance that we will see it break the $300 level by Mid-October.

(A Top Pick Oct 3/16. Down 3%.) You have to own gold all the time. It’s a form of currency and a proxy to the US$, which he thinks is bottoming out. Has reduced his gold exposure materially, but always has some on.

Gold had a pullback from $1350, and there was quite a bit of frothiness in the commodity itself in terms of the open interest. It is still quite elevated, but going into this quarter and the foreseeable future, this is something he just feels he has to own. He would typically trade gold through options. Feels this has to be a core in everybody’s portfolio.

Gold? A one-year chart shows gold doing very well. Looking at Europe, Switzerland and Japan, which all have negative interest rates, large denomination banknotes are all out of circulation. Depositors are questioning why they should keep money in a bank. The alternative is to be buying gold. The 5-year chart shows a long downtrend from 2012 to the end of 2015 when it had a big break out, which is a bullish sign. He can see this going to around $145, and gold going to around $1440-$1500. To finish any big commodity cycle, you need to take out the high cost producers to shrink the supply. There are a large number of high cost producers in gold with costs around $1100. That sets the base for higher prices going forward.

What is really moving gold right now is whether the US Federal Reserve is going to raise rates or not. That makes this very large asset class of US treasuries more attractive as well as the US$ and its strength. Because she is not expecting an interest rate hike until September, gold is a fairly safe place for the next 2 months, but not after that. When they start talking about raising rates in September, that is the time when you should be out.