Like most things in life, the commodities market has its cycles. Some are slow, multiyear pulses based on difficult-to-define factors involving global supply and demand; others are monthly or even daily flutters, sparked by current events and political decisions. Annual market cycles are also very common.

Because of the low short-term volatility of gold, it’s not a good choice for day trading. However, even the price of gold bullion varies annually. The savvy gold trader can take advantage of this cycle, just by exercising a little patience.

September is by far the best month to sell your gold. Since January 1970, September gold prices have outperformed August prices 65% of the time.

For the full thirty-year period, the rise has averaged 2.58%. January is a middling second at 2.23%; no other month even comes close.

Why the big increase in September gold prices?

Because September is the start of the fall and winter gift-giving season. The Islamic holy month of Ramadan, in which generous gift-giving is encouraged, wraps up in early September. (Pun fully intended).

The Chinese are also fond of the yellow stuff, stocking up early for gifts on National Day (October 1). After a sharp dip in October (-0.07%, on average), gold prices rebound in November as jewelers worldwide stock up not just for Christmas and Hanukah, but also for the Indian festival of Diwali and the Indian wedding season. (India is the world’s biggest gold consumer.)

Conversely, gold prices tend to drop precipitously in March, with dips averaging -0.10% below February’s price since January 1970.

So if you’re buying gold, March is the best month to do it.  And October is also a good gold-buying month.

And before you buy or sell, check out this article on cutting through the gold bullion price confusion for some good tips.

Do you take advantage of these types of trends? Let me know below…