Gold intraday pattern

By Dimitri Speck (27 October 2006)

Since August 5, 1993, there has been a systematic attempt to administer downward impulse to the gold price through loans and sales of the metal. How do we know the date when the systematic interventions began? By observing their execution times. These actions are not divided evenly throughout the day, but instead tend to focus on important time points such as the PM-Fixing and the New York closing price. Additionally, COMEX trading hours are preferred. This creates an intra-day pattern that can be statistically identified and allows us to pinpoint the starting date of the interventions on August 5, 1993.

This intra-day anomaly existed for a very long time, but has weakened the last few years in the course of the continued upward trend in prices. The attached chart shows the average intra-day trend of all days for which there are high numbers of price fixings. The right axis shows the price, the bottom scale the time of day. The average is calculated by taking the minute by minute prices throughout the day from about 2000 days and consolidating them as a single day. Thus this so-called intra-day seasonal chart shows at a glance how intra-day prices behaved over the last eight years.

Clearly visible is the price decrease at the time of the London afternoon fixing. The minor lows near the morning fixing as well as the open and close in New York are all worth noting. Also conspicuous is that during American market hours the price generally trends sideways, in contrast to the rest of the time when it is moving upwards.